Molly wanted to start her own dry cleaning business. She borrowed $50,000 from ABC Bank.

1.    Molly wanted to start her own dry cleaning business. She borrowed $50,000 from ABC Bank. She used her car as the collateral and also gave ABC Bank an interest in any property she acquired after the security interest was made. The bank perfected its interest. Molly purchased a new computer from XYZ Electronics to use in her business. XYZ obtained a purchase money security interest on the computer and filed a financing statement. Molly was having problems with cash flow and failed to make payments to XYZ Electronics on the new computer. The electronics store sought to repossess the computer, but the bank opposed that. Molly’s business picked up and she was able to completely repay her loan to the bank. She requested that the bank discontinue its security interest, but the bank did not do so as requested by Molly, and still had not done so 45 days after Molly had paid off the loan and requested that the bank terminate its interest. Which of the following is true regarding any compensation that Molly is entitled to from the bank because the bank did not timely file notice that it had no interest in her goods?

She may recover $100 from the bank.

She may recover $200 from the bank.

She may recover $500 from the bank.

She may recover $1,000 from the bank.

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