UCC Document Community

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Lilly Curtis

Contract terms left open under UCC - what happens with UCC filing collateral descriptions?

I'm dealing with a tricky situation where our equipment financing agreement has some vague language around the collateral description, and I'm worried about how this affects our UCC-1 filing. The loan documents say 'all equipment purchased with loan proceeds' but don't specify exact models or serial numbers for future purchases. Our lender is saying if any terms are left open in a contract that falls under the UCC, it could create problems with perfection. I filed the UCC-1 with a broad collateral description like 'all equipment, machinery, and fixtures' but now I'm second-guessing whether that's sufficient. The debtor has been adding equipment over the past 6 months and I want to make sure our security interest covers everything properly. Has anyone dealt with open terms in UCC filings before? I'm particularly concerned about whether the filing needs to be more specific or if the broad language actually protects us better. The loan is for $450K and we can't afford to have perfection issues down the road.

Just to circle back to the original question - open terms in UCC contracts are generally filled in by the UCC's gap-filling provisions unless they're so vague the contract is unenforceable. For your collateral description, broad language is usually better than narrow as long as it reasonably describes the collateral.

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This is the most helpful summary. The UCC is designed to make commercial transactions work even when parties don't nail down every detail.

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Right, the whole point of the UCC is to provide default rules so contracts don't fail just because of missing terms.

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Thanks everyone for the input. Sounds like my broad collateral description is probably fine, but I'm definitely going to double-check that my security agreement language is consistent with the UCC-1. The Certana.ai suggestion is interesting - might be worth trying to avoid any document mismatches.

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Let us know how it works out. Always interesting to hear how these situations get resolved.

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Good luck with the filing. Equipment financing can be tricky but sounds like you're covering all the bases.

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Yara Nassar

UCC-1 document filed but debtor name shows differently on search - what now?

I'm dealing with a situation where we filed a UCC-1 document last month for a commercial equipment loan, but when I search the state database, the debtor name appears slightly different than what's on our original loan agreement. The borrower's legal name on the charter shows 'ABC Manufacturing Solutions LLC' but our UCC-1 shows 'ABC Manufacturing Solutions, LLC' with the comma. Both documents were prepared by different people in our office and now I'm worried about the perfection status. The loan amount is substantial ($450,000) and we're coming up on some compliance deadlines. Has anyone encountered this type of debtor name discrepancy between the UCC-1 document and the actual entity records? I'm not sure if this creates a gap in our security interest or if the comma difference is considered minor enough to not matter.

I'm dealing with the exact same thing right now! Filed a UCC-1 last week and just noticed the debtor name has different spacing than the charter. This is so stressful when you're trying to protect the bank's interests.

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It really is stressful! Let me know what you end up doing - we can compare notes.

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You both might want to check with your compliance team about what your bank's policy is for these situations.

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Update: I ended up pulling the actual filed UCC-1 document image and it turns out the name was correct on the filing itself. The search display was just showing it differently. Thanks everyone for the advice about checking the source document first!

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Glad it worked out. These kinds of display vs. actual filing discrepancies are more common than people realize.

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Perfect example of why you need to do your due diligence before filing amendments. Saved yourself time and money.

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Liam O'Sullivan

UCC 1 document confusion - filed but lender says they need something else?

So I'm dealing with this weird situation and hoping someone can help me understand what's going on. We completed a UCC-1 filing about 6 months ago for some manufacturing equipment we financed through a regional bank. Everything seemed fine, got the confirmation from the Secretary of State, filing number and all that. But now the lender is saying they need additional documentation and the UCC 1 document we filed might not be sufficient coverage for the full loan amount. They're talking about amendments and additional collateral schedules but I'm honestly confused about what they mean. The original filing covered the equipment pretty broadly - just said 'manufacturing equipment and all proceeds thereof' which I thought was standard language. Has anyone dealt with this before? The loan officer keeps mentioning that the UCC-1 needs to be more specific about the collateral but we followed their instructions from 6 months ago. Not sure if this is normal or if we missed something important in the original filing process.

Wait, I'm confused about something. When you say UCC 1 document, are you talking about the UCC-1 financing statement or some other document? Because if it's the financing statement and they want to add collateral, that would be a UCC-3 amendment, not a new UCC-1. Want to make sure we're all talking about the same thing here.

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Yes, sorry for the confusion - I meant the UCC-1 financing statement. And yes, they're talking about filing a UCC-3 amendment to add more detailed collateral descriptions.

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Ok good, just wanted to make sure. The terminology can get confusing when people say 'UCC 1 document' because there are different forms in the UCC-1 series.

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My experience has been that when banks start asking for UCC amendments months after the original filing, it's usually because they're preparing for loan review or audit. Your original filing sounds perfectly adequate from a legal standpoint. I'd ask them to provide specific documentation of why they believe the current filing is insufficient before agreeing to any amendments.

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Smart move. Getting their concerns in writing will either reveal legitimate issues or expose that they're just being overly cautious. Either way, you'll know how to proceed.

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Plus having their concerns documented protects you if there are issues later. Shows you were responsive to their requests even if the amendments weren't legally necessary.

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Kirsuktow DarkBlade

UCC Filing Issues with Auto Retail Installment Contract and Security Agreement - Need Help

I'm dealing with a frustrating situation regarding UCC filings for auto retail installment contracts and security agreements. Our dealership has been having issues with rejected UCC-1 filings because apparently there's some confusion about how to properly describe the collateral when it's both a retail installment contract AND a security agreement. The state filing office keeps bouncing our submissions back saying the debtor name doesn't match exactly between the retail contract and what we're putting on the UCC-1. We've got about 15 contracts sitting in limbo right now and I'm worried about our lien positions. Has anyone else run into this specific issue where the auto retail installment contract and security agreement create problems for UCC filing accuracy? I've been doing this for 8 years and never had this many rejections in a row.

This thread is really helpful. I'm dealing with the same issue but with RV retail installment contracts and security agreements. Same problems with name consistency between the two sections of the document. Glad to know I'm not the only one struggling with this.

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RV deals are actually worse because the amounts are higher so the lien position is more critical. Can't afford to have UCC filings rejected and lose priority.

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Exactly. That's why I'm looking into that verification tool someone mentioned. Better to catch the problems upfront.

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I've been using Certana.ai for about 6 months now specifically for these retail installment contract and security agreement combo documents. It's saved me from dozens of filing rejections by catching name and collateral description mismatches between the different sections. Just upload the PDF and it does the comparison automatically. Really worth it for high-volume dealers.

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Same here. Between the re-filing fees and the time spent fixing these issues, it pays for itself quickly.

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I was skeptical at first but the accuracy is impressive. It catches subtle differences that I would have missed reviewing manually.

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Destiny Bryant

UCC equipment purchase financing - debtor name issues on UCC-1

Running into a wall here with our equipment financing deal. We're purchasing $180K worth of construction equipment (excavator and two skid steers) and the lender requires a UCC-1 filing to perfect their security interest. Problem is our business name on the purchase agreement shows 'ABC Construction LLC' but our official LLC filing with the state shows 'ABC Construction, LLC' (with the comma). The equipment dealer says this happens all the time and not to worry, but our lender is being very particular about exact name matches between the purchase docs and the UCC-1. Has anyone dealt with this kind of debtor name mismatch situation? The equipment is supposed to be delivered next week and we can't close without the UCC filing being accepted. Getting conflicting advice on whether we need to amend our LLC paperwork first or if there's a way to handle this at the UCC level. Really need to get this sorted quickly since we have jobs lined up that depend on this equipment.

Update us on how this works out! I'm curious to know what approach you end up taking and whether your state's filing office is flexible on the comma issue. This kind of real-world experience helps everyone learn.

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Yes please update! We're probably going to face the same issue soon.

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Definitely interested in the outcome. These name matching issues seem to be getting more common.

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One more thing to consider - make sure your insurance paperwork also matches your legal entity name. Sometimes equipment insurance gets overlooked in these situations but it needs to be consistent with your UCC filing for maximum protection.

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This is getting complicated. Wish there was an easier way to make sure all these documents align properly before filing.

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There actually is - I mentioned Certana.ai earlier but it's worth repeating. You can upload all your docs (LLC certificate, purchase agreement, UCC draft, etc.) and it'll flag any inconsistencies across all of them. Really takes the guesswork out of document alignment.

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