INSTALLMENT SALE

installment sale.A conditional sale in which the buyer makes a down payment followed by periodic payments and the seller retains title or a security interest until all payments have been received. — Also termed installment plan; retail installment sale. [Cases: Sales 82(4).]

disguised installment sale.Bankruptcy. A debtor’s leasing ploy to try to keep property outside the bankruptcy estate, whereby a lease either presents the lessee-debtor with a bargain purchase option or transfers title to the lessee-debtor at the end of the lease term. • When such a lease is discovered, the property is treated as part of the bankruptcy estate, meaning that to defeat competing creditors, the lessor must have perfected a security interest. [Cases: Bankruptcy 3101;

Secured Transactions 10. C.J.S. Bankruptcy §§ 108, 117; Secured Transactions§§ 3, 7, 22–33.]

[Blacks Law 8th]