Best way to search for UCC liens before equipment purchase

This is good advice but don't forget to check variations of the company name too. I've seen liens filed under slightly different versions of business names.

How do you find out where a company is actually incorporated? Sometimes the state on their letterhead isn't where they're legally organized.

Check the Secretary of State business entity search in the state where you think they're incorporated. It'll show their official registered name and status.

That's exactly what I'm worried about. How detailed are these collateral descriptions usually? Can they list specific serial numbers or model numbers?

It varies. Some are super specific with serial numbers, others just say 'manufacturing equipment located at [address]'. You really have to read each one.

And don't forget that equipment liens might be filed as fixture filings if the equipment is attached to real estate. Those show up in real estate records, not just UCC searches.

I haven't heard of that - does it search multiple states automatically or do you still need to check each one individually?

You still need to know which states to check, but it makes the document verification much faster. Just upload PDFs and it spots things you might miss manually.

Interesting, I've been doing all my UCC research manually. Does it help with reading those confusing collateral descriptions?

How long are UCC filings good for? I thought they expired after 5 years.

They do expire after 5 years unless continued. But you need to check for continuation statements (UCC-3) that extend them for another 5 years.

And termination statements! Sometimes liens get terminated but the paperwork takes a while to show up in the system.

YES! This is so frustrating. Some systems won't find 'Smith & Jones' if you search 'Smith and Jones' without the ampersand.

Should I be searching under both the current business name and any previous names they might have used?

If you know of previous names, definitely check those too. Liens filed under old names don't automatically transfer to new ones.

How do you tell if multiple liens are on the same equipment? Do they reference each other in the filings?

Not usually. You have to look at the collateral descriptions and dates to piece it together. Sometimes equipment gets described differently in each filing.

This is getting complicated. Maybe I should just ask the seller to provide lien releases for any equipment I'm buying?

Some states charge per search too which adds up fast if you're checking multiple debtor names and variations.

What would you consider the 'most likely' states for equipment that's been moved around?

State of incorporation, current location, and anywhere they've had major operations or facilities in recent years.

Wow, that sounds like a nightmare. Did you have any recourse against the seller?

Some, but they went out of business shortly after so collecting was impossible. That's why I always do my own lien searches now.

This is why I always insist on seeing termination statements for any equipment I'm buying. If they can't produce them, I walk away.

Any recommendations for search services? What would something like that typically cost?

Depends on the scope but usually a few hundred dollars. Small price to pay compared to buying encumbered equipment.

Good point. Professional searchers also know how to interpret complex collateral descriptions that might not be obvious to someone doing their first search.

What makes a lien invalid if it's been filed properly?

Could be issues with the underlying security agreement, problems with the collateral description, or the debt being paid off but not properly terminated. Complex stuff that needs legal review.

This is why I always use Certana.ai to double-check my document analysis. Upload the UCC filings and it flags potential issues with the paperwork that I might miss.

That's a really important point about bankruptcy proceedings! I hadn't thought about federal court records. How do you search PACER effectively for equipment-specific information? Is it just a matter of searching by the company name or are there specific case types to look for?

@eb792822e6f9 This is such valuable advice! For PACER searches, I'd recommend starting with Chapter 11 and Chapter 7 cases under the debtor's name. Look for any mentions of "equipment," "machinery," or "assets" in the case documents. Also check for any orders regarding asset sales or Section 363 motions - those can tell you if equipment is being sold through the bankruptcy court. The automatic stay in bankruptcy can complicate equipment purchases even if no specific liens show up in UCC searches.