Section 55-9-622 - Effect of acceptance of collateral.
55-9-622. Effect of acceptance of collateral.
(a) A secured party's acceptance of collateral in full or partial satisfaction of the obligation it secures:
(1) discharges the obligation to the extent consented to by the debtor;
(2) transfers to the secured party all of a debtor's rights in the collateral;
(3) discharges the security interest or agricultural lien that is the subject of the debtor's consent and any subordinate security interest or other subordinate lien; and
(4) terminates any other subordinate interest.
(b) A subordinate interest is discharged or terminated under Subsection (a) of this section, even if the secured party fails to comply with Chapter 55, Article 9 NMSA 1978.