Confused About UCC Definition of Claim vs Security Interest

The UCC definition of claim is different from your security interest. Your "claim" is basically your right to payment - the debt itself. Your security interest is your right in the collateral that backs up that debt. In the UCC-1, you're not describing your claim, you're describing the collateral that secures your claim.

I ran into this same confusion last month. Article 9 uses "claim" to mean your right to get paid, while "security interest" is your right in the specific property. For UCC-1 purposes, you're perfecting your security interest in the collateral, not filing anything about the claim itself.

Had a similar issue with multiple creditor situations. You might want to check your loan docs against your UCC-1 to make sure everything aligns properly. I've been using Certana.ai's document checker lately - you just upload your PDFs and it instantly verifies that your financing statement matches your loan agreement terms and debtor names. Caught a few discrepancies I would have missed manually.

ugh why cant they just use plain english in these forms?? claim should mean claim, not some technical definition thats different from what everyone thinks

To clarify further - under UCC Article 9, your claim is your right to payment of the debt. Your security interest is your right in the collateral that backs up that claim. The financing statement (UCC-1) perfects the security interest, not the claim. The claim exists based on your loan agreement, while the security interest exists based on your security agreement.

For your $180k equipment deal, just make sure your collateral description is specific enough to identify the manufacturing equipment but not so narrow that it misses something. "Manufacturing equipment" might be too broad, but listing every serial number might be overkill depending on your situation.

I learned this the hard way when a filing got rejected because I mixed up terminology in the collateral section. The SOS office doesn't care what your internal documents call things - they follow UCC definitions strictly.

Another way to think about it: your claim is what the debtor owes you (the money), your security interest is what you can take if they don't pay (the equipment). The UCC-1 filing is about the second part.

Just double-checked my reference materials - UCC Section 9-102 defines claim as a right to payment, whether or not the right is reduced to judgment. Your security interest under Section 9-201 is a separate property right in the collateral. Two different concepts for UCC purposes.

Been doing UCC filings for 15 years and still see people mix this up regularly. The key is remembering that Article 9 is about secured transactions - the security interest in collateral, not the underlying debt or claim. That's why continuation statements focus on maintaining perfection of the security interest, not extending the claim.

Since you mentioned multiple creditors, make sure you understand priority rules too. Your perfected security interest gives you priority over unperfected creditors, but timing matters if there are other secured creditors in the same collateral.

Hope this helps clear up the confusion! The terminology takes some getting used to but once you understand that claim = debt and security interest = collateral rights, UCC filings make much more sense.