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Risk Management Blog

UCC & Corporate Due Diligence

Resource Guide for Legal and Financial Professionals

How to Choose a Monitoring Program for Asset-Based Lenders and Factors

UCC, Due Diligence, Reduce Financial Risk, Tips, Lien Monitoring, Events & Tradeshows

In honor of the 2014 Factoring Conference, we compiled some of our favorite tips on choosing a lien monitoring solution, a service that all asset-based lenders and factors need to help mitigate risk. Here is a quick ‘stress test’ you can give your lien monitoring approach to see if it’s up to scratch.

Does your lien monitoring program…

Quickly Alert You of Federal Tax Lien Filings?

Many creditors consider Federal Tax Liens the most urgent of all liens because they can prime a perfected UCC. For factors and asset-based lenders, it’s critical to know about a Notice of Federal Tax Lien as soon as possible, so they can act within the 45-day window—remember, a UCC only provides priority protection for 45 days if a Federal Tax Lien is filed.

“In the real world of getting tough deals done, nothing can replace the importance of knowing if and when a Federal Tax Lien is filed.”

– Darrel Pierce, Dkyema Law Group

Notify you of Junior UCC1 Filings and UCC3 Change Statements?

Monitoring debtor names for junior UCC1 filings can reveal if another creditor has taken a position with your debtor and the possible breaking of negative covenants. Monitoring for UCC3 change statements provides creditors timely information on any unauthorized changes to their perfected UCC, such as an unauthorized termination.

Include State Tax Liens and Judgment Liens?

Many secured parties also insist on monitoring for State Tax Liens and Judgment Liens. For State Tax Liens, being alerted right away if their borrower is failing to pay their taxes is vital as it could be an indication of financial distress, while Judgment liens can be a good indicator of character among other things.

The FCS team will be at booth #215 with prizes, networking opportunities and information on our Account Monitoring Program. Please stop by and say “Hi!”

First Corporate Solutions is committed to uncovering name variations and locating involuntary and hidden liens in both our online search system and our manual search efforts. Contact us today for more information on search services: 800.406.1577 | info@ficoso.com




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