Receivables and the Sale of Accounts (UCC Article 9)
Receivables are rights to be paid. Under UCC Article 9, many kinds of receivables are "accounts," and Article 9 governs both loans secured by accounts and outright sales of accounts.
What is an account?
UCC § 9-102(a)(2) defines “account” to include a right to payment of a monetary obligation, whether or not earned by performance, for property that has been or is to be sold, leased, licensed, assigned or otherwise disposed of, or for services rendered or to be rendered, among other listed categories. It excludes rights to payment evidenced by an instrument or chattel paper, and rights to payment for money or funds advanced or sold (other than certain credit-card obligations).
Sales of receivables are covered by Article 9
Article 9 applies not only to security interests created by contract but also to a sale of accounts, chattel paper, payment intangibles, or promissory notes (UCC § 9-109(a)(3)). That is why a buyer of receivables often files a financing statement to perfect its interest.
Paying the right party
When accounts are sold or assigned, UCC § 9-406 tells the account debtor whom to pay — the assignor until notified, then the assignee. See assignments.
Debt buying
Charged-off consumer debts are often sold to debt buyers, sometimes in recurring sales under forward flow agreements. Debt buyers who collect may be subject to federal and state debt collection laws depending on how they operate.
Researching sale of receivables in your state
To research sale of receivables for a real matter, start with the primary sources. For example, read the statute, the rule and the documents in your own file. Then look for recent appellate decisions from your state, because they control how local courts read the law. After that, compare what you found with the federal rules that may also apply. Our state procedures guide and the Research Center can help you find and check each source.
Sources and further reading
Official sources used on this page:
Related reading on Lawtopolis:
Sources
- UCC §§ 9-102(a)(2), 9-109(a)(3), 9-406
Official sources:
law.cornell.edu/ucc/9/9-102
law.cornell.edu/ucc/9/9-109
law.cornell.edu/ucc/9/9-406
Sources last reviewed: 2026-10-23
Lawtopolis provides legal information and education, not legal advice. Using this site does not create an attorney-client relationship. Laws and court rules vary by jurisdiction and change over time; verify every authority against the official source and consult a licensed attorney in your jurisdiction about your situation.