1. Town Loan Center agrees to loan Sara $1,500, accepting as collateral her car. They put their agreement in writing and sign it. Sara keeps possession of the car. Does Town Loan have an enforceable security interest? How can Town Loan let other creditors know of its interest in the car?

2. Digital Devices is a retail seller of entertainment media. Digital Devices sells a 3D HD TV set to Edmund. Edmund cannot pay cash, so he signs a security agreement, paying a certain amount down and agreeing to pay the balance in twelve equal installments. The security agreement gives Digital Devices a security interest in the set. Edmund makes six payments on time then goes into default because of unexpected financial problems. Digital Devices repossesses the set. Can the creditor keep it in full satisfaction of the debt? Explain.

3. Federal Bank is a secured party on a $50,000 loan to Gigi, who owns Home HealthCare, an assisted living facility. When Gigi experiences financial difficulty, creditors other than Federal Bank petition her into involuntary bankruptcy. The value of the secured collateral has substantially decreased in value. On its sale, the debt to Federal Bank is reduced to $25,000. Gigis estate consists of $100,000 in exempt assets and $20,000 in nonexempt assets. After the bankruptcy costs and back wages to Gigis employees are paid, nothing is left for unsecured creditors. Gigi receives a discharge in bankruptcy. Later she decides to go back into business. By selling a few exempt assets and getting a small loan, she is able to buy Indulgence, a small, profitable nightclub. Gigi goes to Federal Bank for the loan. The bank claims that the balance of its secured debt was not discharged in Gigis bankruptcy. She signs an agreement to pay Federal Bank the $25,000, and the bank makes a new unsecured loan to her. Is Federal Bank correct that the balance of its secured debt was not discharged in bankruptcy? What is the legal effect of Gigis agreement to pay the bank $25,000 after the discharge in bankruptcy?