These include the ability to possess the collateral upon the debtor's default, and the right to sell the collateral and apply the proceeds to the secured creditor's debt. Moreover, if the collateral sells for more than the amount of the secured creditor's debt, the secured creditor has to give the excess back to the debtor. This is done by private sale, or by a sale through the court. After the sale, the debtor is foreclosed from asserting any interest in the property sold. The secured party is typically required to apply the sale proceeds to the debtor's debt, after first paying the expenses related to the sale.
State law governs the form and validity of the security agreement.
Article 9 of the UCC, enacted in all 50 states, deals with personal property security interests. This is a powerful statement. It essentially states that compliance with Article 9 gives a secured creditor rights not only against the debtor, but against the world. Article 9's analogue to creation is attachment. Once the security interest attaches, the secured creditor may enforce its interest against the debtor, even if unperfected.