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Nia Thompson

UCC filing rejected - personal property security agreement debtor name issue

Filing a UCC-1 for the first time and running into problems with my personal property security agreement. The SOS portal rejected my filing twice now saying there's a debtor name mismatch but I copied it exactly from the security agreement. The debtor is an LLC and I used "ABC Manufacturing Solutions, LLC" which matches their articles of incorporation exactly. The collateral is equipment financing for manufacturing machinery worth about $340K. Anyone know what I'm missing here? The continuation deadline is coming up in 18 months and I can't afford to mess this up since it could void our lender agreement. Really frustrated with this whole process.

Just wanted to add that timing matters too. If your personal property security agreement was signed recently, make sure the LLC was actually formed before the security agreement date. I've seen rejections where the entity didn't exist yet when the security agreement was executed.

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Good catch. The LLC has been around for 3 years so that shouldn't be the issue, but I'll double-check the formation date against our security agreement.

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This is why due diligence on entity status is so important before finalizing loan docs.

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Update us when you figure it out! I'm dealing with a similar personal property security agreement filing issue and curious what ends up being the problem.

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Will do! Going to try the entity name search first, then maybe call the filing office if that doesn't work.

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Hope you get it sorted out. These name mismatch rejections are so common but usually have simple fixes once you know what to look for.

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CosmicCowboy

UCC filing strategy for general business security agreement - which collateral schedule approach works best?

I'm handling the UCC-1 filing for a general business security agreement that covers pretty much everything - inventory, equipment, accounts receivable, the works. The loan is for $2.8M and I want to make sure I get the collateral description right without being too broad or too narrow. Our bank's template uses 'all assets' but I've heard some states reject that as too vague. Should I go with the detailed schedule approach or stick with the broader language? This is going through Delaware's online portal and I really can't afford to have this rejected and cause delays on the closing.

Update us on how it goes! Always curious to hear about other people's filing experiences, especially on larger deals like this.

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Will do! Planning to file tomorrow morning once I get all the details sorted out. Thanks everyone for the input.

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Good luck! Delaware's system is usually pretty quick on the turnaround.

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One more thing - make sure you calendar the continuation deadline as soon as you file. Five years goes by faster than you think, especially on these big commercial deals.

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Great reminder - I'll set up calendar alerts as soon as I get the filing number back.

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And remember you can file the continuation up to 6 months before the 5-year mark, so you have some flexibility on timing.

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Beatrice Marshall

General Security Agreement and UCC Filing Requirements - Missing Something Important?

I'm handling a complex equipment financing deal where we have a general security agreement covering multiple categories of collateral (inventory, equipment, accounts receivable). The borrower operates manufacturing facilities in three states. I've prepared the UCC-1 but I'm second-guessing whether our collateral description is broad enough to cover everything in the general security agreement. The GSA lists specific equipment by serial number in Schedule A, but also includes blanket language for "all present and after-acquired inventory." Should the UCC-1 mirror the exact language from the general security agreement, or can I use broader categories? I'm particularly concerned about the equipment descriptions - some pieces were acquired after the original GSA was signed. Also wondering about filing locations since they have facilities in multiple states. This is a $2.8M credit facility so I can't afford to miss anything that would leave us unperfected. Any guidance on best practices for aligning general security agreement terms with UCC-1 collateral descriptions?

Don't forget about the search implications too. When you're doing your UCC searches, you want to make sure your collateral descriptions are searchable by other parties who might be looking for conflicts. If you use very unique or non-standard language, it might not show up in typical searches, which could cause problems down the road.

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That's a really good point I hadn't considered. Standard industry terminology probably makes the most sense for searchability.

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Exactly. Stick to terms that other lenders and searchers would expect to see. Don't get too creative with your descriptions.

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Xan Dae

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Final thought - make sure your general security agreement and UCC-1 are both dated consistently and that your UCC-1 is filed promptly after the GSA is executed. The timing can matter for priority purposes, especially if there are other creditors involved. You don't want any gaps that could let another creditor slip in ahead of you.

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Thanks everyone for all the detailed guidance. This has been incredibly helpful for thinking through all the moving pieces. I feel much more confident about structuring this properly now.

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Just to close the loop on the document verification discussion - I tried Certana.ai on a recent deal and it caught a collateral description inconsistency I completely missed. Really worth the peace of mind on larger transactions like yours.

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Chloe Wilson

UCC record showing wrong debtor name after equipment loan refinance

Need help with a UCC record issue that's causing problems with our equipment refinancing. We refinanced our construction equipment loan last month and the new lender is saying our UCC record has the wrong debtor name listed. The original UCC-1 was filed under "ABC Construction LLC" but our legal business name changed to "ABC Construction Services LLC" about 18 months ago. The old lender never updated the UCC record and now the new lender won't close until this gets fixed. I'm confused about whether we need a UCC-3 amendment or if the original filing is just invalid now. The equipment is worth about $180K so this isn't something we can mess up. Has anyone dealt with a similar debtor name mismatch situation? What's the proper way to fix this UCC record without voiding the security interest?

The good news is this is totally fixable with a UCC-3 amendment. The bad news is it's going to add some time to your refinancing process. Make sure your new lender understands the timeline for getting the amendment processed. Most are pretty understanding about these things as long as you're proactive about fixing it.

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That's reassuring. I was worried the new lender might walk away from the deal over this.

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Nah, this stuff happens all the time in commercial lending. As long as you're working to fix it, most lenders will be patient.

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One more thing to consider - make sure your business insurance and other documentation also reflects the correct legal name. Sometimes name change issues cascade across multiple areas and you want to make sure everything is consistent.

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This is why I always recommend doing a complete review of all legal documents when a business changes names. It's a pain but it prevents these kinds of surprises later.

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Thanks everyone for the advice. Sounds like the UCC-3 amendment is definitely the right approach. Going to get started on that paperwork today and hopefully get this resolved quickly.

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Sebastián Stevens

What is a UCC-1 statement and when do you file one

I'm helping my brother with his equipment financing paperwork and the lender keeps mentioning something called a UCC-1 statement. I've tried googling but I'm getting really technical legal jargon that's confusing me. Can someone explain in plain English what exactly a UCC-1 statement is and when you're supposed to file one? My brother is buying some heavy machinery for his construction business and apparently this is required but I don't understand why or what it does. Is this something the bank files or does he need to handle it himself? Any help would be appreciated because I'm trying to make sure we don't miss any important deadlines or requirements.

Don't stress about it. This is routine stuff that happens thousands of times every day. The important thing is that your brother is getting the financing he needs for his business. The UCC-1 is just paperwork protection for the bank.

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Thanks, that's reassuring. Sometimes all the legal terminology makes simple things sound scary.

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Totally understand that feeling. The financial world loves its acronyms and technical terms, but most of it is just standard business practice.

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One last thing - when the loan is eventually paid off, make sure the bank files a UCC-3 termination statement. That removes the public record of their security interest. Some banks are slow about this, so you might need to follow up.

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How long do they usually have to file the termination after the loan is paid off?

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It varies by state, but typically within 30-60 days after payoff. If they don't do it automatically, you can request it. Some lenders will even give you the termination statement at closing so you can file it yourself when the time comes.

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