UCC Document Community

Just want to echo what others said about double-checking everything before filing. Between rejection fees and amendment costs, mistakes get expensive fast. I use a checklist now to verify debtor names match exactly, addresses are current, and collateral descriptions are complete.

One more thing to consider - if you're doing equipment financing deals, make sure you understand the difference between purchase money security interests and regular security interests for UCC filing purposes. PMSI filings have different priority rules and timing requirements, especially if there's existing financing on the same collateral. It won't affect the NY filing fee but it could impact your collateral description and filing strategy. Also, for equipment that might move between states, consider whether you need to file in multiple jurisdictions from the start.

Great thread - really helpful info here! One additional consideration for NY UCC filings: make sure you're clear on the collateral description. NY DOS will reject filings if the collateral description is too vague. For restaurant equipment and inventory, I usually include specific categories like "kitchen equipment, dining room furniture, food inventory, beverages, point-of-sale systems" rather than just "all equipment and inventory." The more specific you can be without being overly restrictive, the better your chances of acceptance and proper perfection.

One thing I'd add for NY restaurant UCC filings - don't forget about after-acquired property clauses if the restaurant will be adding equipment or inventory after your initial filing. The standard language "and all after-acquired collateral of the same or similar type or description" can save you from having to file amendments every time they buy new equipment. Just make sure your security agreement supports it. Also, if the restaurant has multiple locations in NY, you might want to consider whether location-specific descriptions help with identification, though it's not required for perfection purposes.

Keep us posted on how this works out. Your situation could help other people who end up in similar circumstances. The court route seems like your best bet given that the secured party is dissolved.

I went through something very similar about two years ago when our asset-based lender filed bankruptcy mid-loan. Even though we had paid down significantly, the UCC-1 was blocking new credit lines. One thing that helped speed up my court petition was getting an affidavit from the liquidation attorney stating they had no authority to file terminations - even though they couldn't help directly, having that official statement actually strengthened my case for judicial termination. The judge appreciated seeing that I had exhausted all other options before coming to court. Also, if you're working with any new lenders for your expansion, some of them will actually advance the legal costs to clear the UCC if it means they can close your deal faster. Worth asking about.

This thread has been incredibly insightful - thanks everyone for sharing your real experiences, both successes and disasters! I'm seeing a clear pattern: the strategy can work but requires treating it like a legitimate business transaction from day one. A few observations from reading through all the responses: 1) Document consistency seems to be the #1 killer of these arrangements - multiple people mentioned character-level precision in debtor names, 2) The IRS implications are broader than I initially thought, especially around market-rate interest documentation, 3) The bankruptcy trustee scrutiny angle is sobering and something I need to plan for even if bankruptcy seems unlikely. One question I haven't seen addressed: for those who successfully implemented this, how did you handle the collateral description? Did you go with broad categories like "all equipment" or get specific with serial numbers and model details? I'm leaning toward being more specific to avoid challenges about vague descriptions, but wondering if that creates maintenance headaches when equipment gets replaced or upgraded.

As someone who's been through this process, I want to emphasize the importance of getting your documentation bulletproof from the start. I filed a UCC-1 on my manufacturing equipment about 18 months ago using a similar structure - lending from my personal holding company to my operating LLC. The key lessons I learned: 1) Get a formal appraisal of your collateral before filing - this establishes the loan amount isn't artificially inflated, 2) Set up a dedicated loan servicing account and make actual monthly payments with proper documentation, 3) File your UCC-1 in the correct state - this trips up more people than you'd think, especially if your LLC is organized in Delaware but your equipment is located elsewhere. The biggest surprise for me was how much ongoing administration this creates. You're not just filing a form and walking away - you're creating a legitimate creditor relationship that needs to be maintained. Also, consider the exit implications early. When I eventually want to sell my business, I'll need to either assign the debt/security interest to the buyer or pay it off and release the lien. Both options have tax consequences I'm still working through with my CPA.

Just to confirm what others said - you absolutely must use the debtor name exactly as it appears on the original 2020 UCC-1 filing. No variations, no 'corrections' to match current documents, no formatting improvements. The continuation is tied to that specific original filing and must reference the debtor identically. Pull the original filing, copy the name precisely, and refile ASAP.

I'm new to UCC filings and this thread is terrifying me! I'm handling my first continuation filing next month and now I'm worried about making these same formatting mistakes. Is there a checklist or best practices guide somewhere for avoiding these debtor name issues? The stories about losing millions in secured positions over punctuation are giving me nightmares. Should I be looking into that Certana.ai tool people mentioned, or are there other ways to double-check before filing?