UCC Document Community

Update us on how this resolves! I'm dealing with a similar situation with deposit account control and curious whether you get the banks to cooperate or end up having to restructure the deal.

I've seen this exact scenario play out multiple times, and the key is persistence with the right people at each bank. Most commercial bankers don't understand the difference between their standard account control language and what's actually required for UCC 9-104 control. You need to get to someone who understands that the control agreement must give you the unilateral right to direct disposition of funds without any further consent from the debtor. I'd recommend preparing a side-by-side comparison showing their standard language versus the required 9-104 provisions - it makes the gaps crystal clear. Also, don't accept any agreement that has carve-outs or exceptions that would require debtor consent for fund transfers. With a $2.8M facility, you can't afford to have control that's only theoretical.

One last thought - make sure you're preserving the electronic signature data long-term. Some platforms only maintain detailed logs for a limited period, but for UCC purposes you might need that authentication evidence years later during enforcement proceedings.

Thanks for starting this discussion, Natasha. As someone who's been through multiple UCC compliance audits, I'd recommend creating a comprehensive electronic signature policy document that specifically addresses UCC 9-105 requirements. Include your authentication methods, data retention procedures, and debtor consent processes. Having everything documented in one place makes audit responses much smoother and demonstrates to examiners that you've thoughtfully considered all compliance aspects. Also consider doing a test run with your audit team before the actual examination - have them review a sample of electronically signed financing statements to identify any potential concerns early.

Bottom line: mortgages secure real estate under real estate law. UCC security agreements secure personal property under UCC law. They can both exist in the same transaction but they're completely different legal instruments with different filing requirements. Your equipment needs UCC-1, your real estate needs mortgage recording, and if equipment becomes fixtures you need fixture filing procedures. Three different things requiring three different approaches.

This is such a helpful thread! As someone relatively new to commercial lending, I was making this way more complicated than it needed to be. I kept thinking there had to be some connection between the mortgage and UCC filings, but now I see they're just two parallel security systems that happen to be used in the same deal. The fixture filing aspect is definitely something I need to research more for my state - sounds like that's where most of the complexity lies. Thanks everyone for breaking this down so clearly!

I'm in a similar boat with an MCA UCC lien that's blocking my SBA loan application. The bank won't proceed until the lien is resolved. Did you find any specific resources for dealing with MCA companies who won't cooperate on correcting or terminating defective filings?

The name variation issue you mentioned is actually a huge red flag that could work in your favor. UCC-1 filings require the exact legal name of the debtor as registered with the state - even minor spelling differences can render the entire filing invalid. I'd strongly recommend pulling your official business registration documents and comparing them character-by-character with what the MCA company filed. If there's any discrepancy, you may have grounds to challenge the entire lien. Also, that "all assets" collateral description is problematic - UCC law requires reasonable identification of collateral, and courts have ruled that overly broad language like this can make filings unenforceable. Many MCA companies count on business owners not knowing these technical requirements. Don't let their daily payment demands pressure you into accepting a potentially invalid lien claim.

I had a Toronto lender once who kept referring to their internal codes like they were official UCC forms. Very confusing. Just stick to the standard filing requirements and you'll be fine.

I've dealt with this exact scenario before with several Canadian lenders. There's definitely no UCC 1-308 form - they're likely using an internal reference number that has nothing to do with US filing requirements. For cross-border equipment financing, you still file a standard UCC-1 in the state where the equipment is physically located. The key things to watch out for: make sure the debtor name exactly matches what's in their security agreement (Canadian entities sometimes have slightly different legal name formats), verify the collateral description is sufficient under US law, and don't let their internal numbering system confuse the actual filing requirements. I'd recommend asking them directly what specific information they need on the UCC-1 rather than trying to decode their reference numbers.