What happens if proceeds are identifiable cash in terms of perfection?

When proceeds are identifiable cash, the security interest in these proceeds is perfected immediately without any additional steps required. This is a distinct feature of cash proceeds under secured transactions law.

Perfection occurs when a security interest becomes enforceable against third parties, and identifiable cash is readily recognizable as being linked to the secured transaction. Therefore, the moment cash is received, the secured party’s interest is automatically perfected, providing them with a superior claim against other creditors. This attribute of identifiable cash ensures that the secured party does not have to undertake further actions like filing a financing statement or obtaining a court order, which would be necessary in other scenarios involving different types of proceeds or collateral.

In contrast, the other options suggest processes that do not align with the efficient and immediate perfection provided by cash proceeds. This understanding is essential for navigating secured transactions effectively, as it allows lenders to secure their interests in the most efficient manner possible.