General Studies · Charges and Security Interests
RRR Bank plc holds a charge over the assets of VVV Ltd as security for its overdraft. The agreement between the parties specifies that interest is fixed at 10% for the duration of the two-year agreement and that amounts receivable from VVV Ltd's major customers will be applied to reduce the overdraft. What type of charge is this?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A floating charge over all the current assets of VVV Ltd
- 2A floating charge over the book debts of VVV Ltd
- 3A fixed charge over the book debts of VVV Ltd✓
- 4A fixed charge as VVV Ltd must pay a fixed rate of interest
Correct answer
A fixed charge over the book debts of VVV Ltd
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