Consumer Credit Regulation: 7.7.8.2.1 General requirements to attain the rights of a holder in due course
The common law rule is that an assignee is subject to all defenses and claims in recoupment that the consumer could raise against the assignor.618 But section 3-305 of the Uniform Commercial Code (UCC) generally allows an assignee of a promissory note or other negotiable instrument to be free from those claims and defenses if it has attained the status of a holder in due course or acquired the rights of a holder in due course.619