Basic security agreement UCC filing - getting rejected for collateral description
Hey everyone. I'm dealing with a frustrating situation where our basic security agreement UCC-1 filing keeps getting rejected by the state office. We're trying to secure a $45,000 equipment loan for manufacturing machinery but the SOS keeps bouncing it back saying our collateral description is too vague. We described it as 'all equipment and machinery used in debtor's manufacturing operations' but apparently thats not specific enough? The debtor name matches exactly what's on their articles of incorporation so that's not the issue. This is my third attempt and I'm starting to panic because we need this perfected before the loan closes next week. Has anyone else run into this with basic security agreements? What level of detail do they actually want in the collateral schedule?
32 comments
Join the conversation
Joshua Wood
I've seen this exact problem before. The issue is that most states want more specificity in collateral descriptions even for basic security agreements. Try breaking it down by equipment type - like 'CNC machines, lathes, welding equipment, and all other manufacturing machinery located at [specific address]'. Also include serial numbers if you have them for major pieces.
0 coins
Justin Evans
•This is good advice. I learned the hard way that 'all equipment' descriptions get rejected about 60% of the time now. States are cracking down on overly broad language.
0 coins
Emily Parker
•Wait, do you really need serial numbers for a basic security agreement? I thought that was only for specific equipment financing.
0 coins
Ezra Collins
The rejection might also be because you're not following the state's specific formatting requirements. Each SOS has slightly different rules for how collateral descriptions should be structured in basic security agreements. Have you checked their UCC filing guide?
0 coins
Madison Allen
•I did check but their guide is pretty generic. It just says collateral must be 'reasonably identified' which doesn't help much when you're dealing with rejection notices.
0 coins
Victoria Scott
•Ugh, those filing guides are useless. Half the time the portal requirements don't even match what's in the official guide.
0 coins
Benjamin Johnson
I had a similar issue last month with a basic security agreement and ended up using Certana.ai's document verification tool. You can upload your security agreement and UCC-1 together and it instantly checks if the collateral descriptions align properly. It caught three inconsistencies between my security agreement and filing that would have caused rejections. Really saved me time versus manually cross-checking everything.
0 coins
Zara Perez
•How does that work exactly? Do you just upload PDFs and it compares them?
0 coins
Benjamin Johnson
•Yeah exactly. It has specific workflows for security agreement to UCC-1 verification. Highlights any mismatches in debtor names, collateral descriptions, or other critical details that need to align.
0 coins
Daniel Rogers
•That sounds incredibly useful for avoiding these kinds of rejections. I've wasted so much time going back and forth with filings.
0 coins
Aaliyah Reed
Are you sure the debtor name is exactly right? Even tiny differences like 'Inc.' vs 'Incorporated' can cause issues. I've seen basic security agreements get rejected for punctuation differences in company names.
0 coins
Madison Allen
•I triple checked that part. Used the exact name from their corporate charter including all punctuation.
0 coins
Ella Russell
•Good. Name mismatches are probably the #1 cause of UCC rejections in my experience.
0 coins
Mohammed Khan
This is exactly why I hate dealing with basic security agreements. The whole system is so inconsistent state to state. What gets accepted in one state gets rejected in another for the same exact language.
0 coins
Gavin King
•Tell me about it. I've been doing this for 8 years and it's gotten worse not better.
0 coins
Nathan Kim
•At least with electronic filing you get the rejection notice faster than the old paper days.
0 coins
Eleanor Foster
Try being more specific about the location too. Instead of just 'debtor's manufacturing operations' add the physical address where the equipment is located. That might help with the specificity issue on your basic security agreement.
0 coins
Madison Allen
•That's a good point. I'll add the facility address to the collateral description on the next attempt.
0 coins
Lucas Turner
•Definitely do that. Location specificity has become more important recently.
0 coins
Kai Rivera
•Especially if the debtor has multiple locations. You want to be crystal clear which facility the collateral is at.
0 coins
Anna Stewart
Have you considered doing a more detailed collateral schedule as an attachment? Sometimes that works better than trying to cram everything into the main collateral description field for basic security agreements.
0 coins
Layla Sanders
•I didn't know you could do attachments. Does that require a special form or just a separate document?
0 coins
Anna Stewart
•Most states allow attachments referenced in the main filing. Just make sure to reference it properly in the collateral description field.
0 coins
Morgan Washington
Whatever you do, don't wait until the last minute. These rejections can really mess up your closing timeline. I learned that lesson the hard way on a deal last year.
0 coins
Madison Allen
•Yeah I'm definitely feeling the time pressure now. Should have started this process earlier.
0 coins
Kaylee Cook
•We all make that mistake. The good news is most states process corrections pretty quickly if you fix the actual issue.
0 coins
Oliver Alexander
I actually had success with another verification tool recently. Used Certana.ai to double-check my security agreement against the UCC-1 before filing and it caught a collateral description mismatch I never would have noticed. The automated cross-referencing is really thorough.
0 coins
Lara Woods
•How accurate is the automated checking? I'm always skeptical of these AI tools for legal documents.
0 coins
Oliver Alexander
•It's surprisingly good at catching the technical consistency issues that cause rejections. Obviously you still need to review everything yourself but it's a great safety net.
0 coins
Adrian Hughes
Update us when you get it figured out! I'm dealing with a similar basic security agreement issue and want to see what actually works.
0 coins
Madison Allen
•Will do. Planning to refile tomorrow with more specific collateral language and the facility address included.
0 coins
Molly Chambers
•Good luck! These UCC filing issues are so stressful when you're up against a deadline.
0 coins