Although most parties prefer to perfect a security via the UCC-1 deposit form, it is also possible to achieve perfection if the secured party has the security. The exception: Ownership does not apply to intangible assets, such as . B receivables. Since many debtors prefer to continue using or owning collateral, this approach is not common. A collateral contract refers to a document that provides a lender with collateral participation in a particular asset or asset that is given as collateral. The conditions shall be laid down at the time of drawing up the safety agreement. Security arrangements are a necessary part of the business world because without them, lenders would never lend to certain companies. In the event that the borrower is in default, the pledged guarantee can be seized and sold by the lender. .