When a practitioner is documenting a loan, he must decide how best to prepare documents that reflect the specifics of the transaction. Part of the practitioner's role is to determine the appropriate style of the loan documents, including whether to document the lender's security interest using shorter-form security documents. This decision should be based on the size, purpose, and complexity of the loan, the relationship between the borrower and the lender, and the nature of the borrower and its business.

Generally, smaller and simpler loan transactions may warrant the use of shorter-form security documents which can streamline the drafting and negotiating process and keep the legal fees for the transaction at a more affordable level. At the same time, the parties must ensure that the security documents contain all material provisions that are required by the lender to take and enforce its security interest in the collateral.

For more information about security structures, security interests and remedies, see Practice Notes:

For a long form of security agreement, see Standard Document, Security Agreement.

For short forms of guaranties, see Standard Documents, Guaranty (Short Form) and Personal Guaranty (Short Form).

For more information about taking and perfecting security interests, including other security documents, see:

This Toolkit contains links to continuously maintained resources that provide information for practitioners using shorter-form security documents for a particular loan.