§3305 When Transfer Is Made or Obligation Is Incurred

Summary

A transfer of property counts as made when it is perfected enough that others cannot get a better right. For land or buildings (not fixtures), that means a good-faith buyer cannot get an interest better than the transferee. For other property or for fixtures, that means a creditor with a basic contract claim cannot get a court-ordered lien that is better than the transferee. If the law allows that kind of perfection but it wasn’t done before a bankruptcy case starts, the transfer is treated as having been made right before the case began. If the law does not allow perfection that way, the transfer is made when it takes effect between the debtor and the transferee. A transfer does not happen until the debtor had rights in the asset. Transfer: when ownership or rights in an asset change under the rules above. Obligation: if spoken, when it takes effect between the parties; if written and signed by the person who owes, when that writing is delivered to the person owed.