How to clear a UCC filing that's blocking equipment refinance
Need urgent help figuring out how to clear a UCC filing that's preventing us from refinancing some manufacturing equipment. We paid off a $180K loan back in March but the UCC-1 is still showing as active when our new lender runs searches. The original lender says they "released" it but I'm not seeing any UCC-3 termination in the system. Equipment dealer is pushing us to close by month-end and this UCC cloud is the only thing holding up approval. Anyone dealt with getting old filings properly cleared? Do I need to file something myself or force the original lender to do it right?
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Sophia Carter
This is exactly why I always insist on seeing the actual termination paperwork before considering any loan paid off. Your original lender probably did an internal release but never filed the UCC-3 termination with the Secretary of State. Super common mistake that costs people deals.
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Chloe Zhang
•Agreed completely. Internal release means nothing to future lenders who run UCC searches. The termination has to be filed officially.
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Brandon Parker
•How long does it usually take for a UCC-3 termination to show up in the system once it's filed?
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Sophia Carter
•Usually 1-3 business days for electronic filings, could be longer if they filed paper. But given your timeline, you need to get moving on this immediately.
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Adriana Cohn
Had this exact situation last year with a forklift loan. Original lender kept saying they'd "handle it" but weeks went by with no UCC-3 termination filed. Finally uploaded both the original UCC-1 and the lender's release letter to Certana.ai's document checker to verify everything matched up before demanding they file the proper termination. Tool caught that the equipment serial numbers didn't align perfectly between docs, which explained why the lender was hesitating.
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Aaron Boston
•Wait, serial number mismatches can cause problems with terminations? I assumed if the loan was paid the UCC would just get terminated regardless.
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Adriana Cohn
•Nope, if there are discrepancies between the original filing and termination, some lenders get nervous about liability. The document verification helped me show the lender exactly what needed to be corrected.
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Jace Caspullo
•That's a really smart approach. Most people just keep calling the lender without any documentation to back up their requests.
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Melody Miles
You need to demand that the original lender file a UCC-3 termination ASAP. They have a legal obligation to clear the lien once the debt is satisfied. If they refuse or keep stalling, you can file it yourself but you'll need their authorization or a court order in most states.
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Aaron Boston
•What kind of authorization would I need from them? Just a letter stating the debt is paid?
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Melody Miles
•Usually needs to be a formal termination authorization or release document that specifically references the UCC filing number and describes the collateral that's being released.
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Nathaniel Mikhaylov
•Be careful with self-filing terminations. Some states are really picky about the format and authorization. Wrong format could delay things even more.
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Eva St. Cyr
OMG this is happening to me right now too!!! Paid off truck loan in January, new lender found the UCC still active in April, original lender claims they filed termination but I can't find it anywhere. So frustrated with this whole system.
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Sophia Carter
•Did you get a copy of the filed UCC-3 termination from them? If they actually filed it, they should have a filing receipt with the date and confirmation number.
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Eva St. Cyr
•They sent me some internal document but no official state filing receipt. Starting to think they never actually filed it.
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Kristian Bishop
This is why the UCC system is broken. Lenders are supposed to file terminations within 20 days of payoff in most states but there's no real enforcement. Meanwhile borrowers get stuck with phantom liens blocking future financing.
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Kaitlyn Otto
•The 20-day rule varies by state and some don't have any specific timeline requirements. It's a mess.
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Kristian Bishop
•Exactly my point. No consistency, no enforcement, borrowers suffer.
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Axel Far
•At least most states now have electronic filing which speeds up the process when lenders actually do their job.
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Jasmine Hernandez
Check the UCC search results carefully - sometimes the termination is filed but under a slightly different debtor name variation. I've seen UCC-1s filed under "ABC Company Inc" and terminations under "ABC Company Incorporated" which makes them hard to match up in searches.
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Aaron Boston
•That's a good point. The original filing was under our full legal name but maybe they abbreviated it on the termination.
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Jasmine Hernandez
•Try searching variations of your company name and also search by the original UCC filing number directly.
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Luis Johnson
Had a client use Certana.ai's UCC verification tool recently for a similar issue. They uploaded the payoff letter and original UCC-1 and it flagged that the collateral description had been modified during an amendment, which explained why the lender was having trouble with the termination. Sometimes these document inconsistencies create more problems than the actual payoff.
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Aaron Boston
•We did have an amendment filed when we added some additional equipment to the collateral. Could that be complicating the termination?
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Luis Johnson
•Definitely possible. If the amendment changed the collateral description, the termination needs to reference the amended version, not the original UCC-1.
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Ellie Kim
•This is why I always keep copies of every UCC amendment. The paper trail gets complicated fast.
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Fiona Sand
Your new lender should be able to help expedite this. They have relationships with the SOS offices and can often get priority processing for terminations that are blocking their deals.
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Aaron Boston
•Good idea, I'll ask them tomorrow. They seem motivated to close this deal.
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Fiona Sand
•Most equipment lenders deal with this regularly and have processes to push lenders to file proper terminations.
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Mohammad Khaled
If time is really critical and the original lender keeps stalling, you might need to consider having your attorney send a demand letter. Sometimes that gets lenders moving faster than phone calls.
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Aaron Boston
•How much does something like that typically cost? Trying to avoid legal fees if possible.
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Mohammad Khaled
•Usually a few hundred dollars for a demand letter, but could save your deal if it gets the termination filed quickly.
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Alina Rosenthal
•Or threaten to file a complaint with your state's banking regulator. That sometimes works too.
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Finnegan Gunn
Don't forget to get a certified copy of the UCC-3 termination once it's filed and keep it with your loan payoff documentation. You'll want proof of the clear title for future transactions.
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Aaron Boston
•Good point. This has been such a headache I want to make sure it never happens again.
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Finnegan Gunn
•Exactly. Clean documentation prevents these problems from recurring when you need to refinance or sell equipment later.
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Miguel Harvey
Update us when you get this resolved! Always curious to hear how these situations work out and what finally gets lenders to do their job.
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Aaron Boston
•Will do. Hopefully calling the original lender first thing Monday with some of these suggestions will get things moving.
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Ashley Simian
•Good luck! Month-end closings are always stressful enough without phantom UCC liens.
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