Risk Management Blog

According to Revised Article 9 of the Uniform Commercial Code, a UCC Financing Statement is only effective if it gets the debtor name right. A UCC filing that fails to properly identify the debtor by their exact legal name will not offer the secured party priority status to collect should the debtor default or file for bankruptcy. Searchers often mistakenly interpret this to mean they only need be concerned with filings that provide an exact… >> READ MORE

On occasion questions come from the escrow community on certain situations that escrow agents find themselves in, involving the transfer of business assets and navigating through the CA UCC Code, under Division 6, Bulk Sale. The questions come in various forms, typically involving a business asset sale and transfer through escrow.  The transactions can involve business assets only or business assets with a Liquor License, but the scenario… >> READ MORE

Rejected Filings The first category of filing mistakes we will discuss is a rejected filing. In these cases, the completed UCC form is submitted to the filing office; the filing officer reviews the document, determines that it fails to meet the minimum requirements for that filing office and returns it to the submitting party without assigning a filing number. Rejected filings can cause a number of problems. First off, a rejected filing… >> READ MORE

In order to fend of challenges to their priority position, UCC filers must keep their filing information accurate and up-to-date. This is accomplished by filing the appropriate UCC3 Statement. There are five types of UCC3 Filings: Continuations extend the term for a Financing Statement by an additional five years Party Amendments add, delete or change debtor or secured party information Collateral Amendments add, delete or… >> READ MORE

UCC searching and filing service providers go to great lengths to keep their customers’ data secure. Technology and in-house procedures provide safeguards to keep your data protected from outside sources. Since service providers, along with state and county filing offices, are the gatekeepers of public records containing transactional information, this is good thing. The nature of the Uniform Commercial Code, however, exposes an important… >> READ MORE

In previous blog posts we have talked about the importance of a secured party listing the correct debtor name on their UCC1 Financing Statement. Remember, a UCC filing is only effective if it gets the debtor name right. A UCC filing that fails to properly identify the debtor by their exact legal name will not offer the secured party priority status to collect should the debtor default or file for bankruptcy. It is dangerous, however to apply… >> READ MORE

In a word, no. The emergence of API for UCC with its increased efficiency and enhanced compliance capability has already occurred and the implementation is spreading. UCC data and portfolio management providers have moved quickly to develop API for UCC and it is now another technology driven differentiator added to their UCC due diligence packages. Much like how UCC portfolio managers and search engines vary in effectiveness and… >> READ MORE

The Uniform Commercial Code (UCC), first published in 1952, is a collection of provisions that govern commercial transactions in the United States. The UCC itself is not law but instead a compilation of suggested best practices. Article 9 of the UCC regards Secured Transactions, that is “business dealings that grant a creditor a right in property owned or held by a debtor to assure the payment of a debt or the performance of some obligation”… >> READ MORE

A search to reflect, also referred to as a post-filing verification search, is a search of the UCC records of the office where you filed after your UCC filing has posted to the index. It confirms proper indexing of a UCC filing and verifies its priority position relative to other creditors, important benefits of a search to reflect. When to perform a search to reflect on your UCC is key. Since you have to wait for the filing index date… >> READ MORE

Once a creditor has filed their UCC Financing Statement they’ll likely want to do all they can to maintain their priority position throughout the life of the loan. Lien-monitoring programs offer a great way for a secured party to keep a watchful eye on other lien-holder activity against their debtor. The concept behind lien-monitoring is that the sooner a creditor knows about a lien, the sooner they can act to protect their interests.… >> READ MORE