How to remove a UCC filing after loan payoff - termination process?
Got a problem here. Paid off our equipment loan 3 months ago but the UCC-1 is still showing up when we run credit checks. The lender said they'd handle the termination but nothing's happened. I called their office twice and they keep saying "it's being processed" but I'm starting to worry this is going to cause issues when we apply for our next credit line. Does anyone know how to remove a UCC filing? I'm seeing conflicting info online about whether I need a UCC-3 termination or if there's some other form. The original filing was for $185K in equipment financing and it's definitely paid in full. I have all the documentation but I don't want to screw this up by filing the wrong paperwork. Any advice on the fastest way to get this cleared? We need clean credit reports for a new facility lease application next month.
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Gemma Andrews
You need a UCC-3 termination statement filed by the secured party (your lender). They're legally required to do this within a reasonable time after payoff. The problem is some lenders are just slow or disorganized about it.
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Lena Schultz
•That's what I thought but they keep stalling. Is there a deadline they have to meet? I'm getting frustrated with their "processing" excuse.
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Gemma Andrews
•Most states give them 20-30 days after written demand. Send them a certified letter demanding termination and reference your state's UCC code section on termination requirements.
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Pedro Sawyer
Had this exact situation last year with a forklift loan. Lender dragged their feet for 4 months until I threatened to file a complaint with the state banking commission. Suddenly they found time to file the UCC-3 termination.
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Lena Schultz
•4 months?? That's ridiculous. What state were you in? I'm in Texas and wondering if there are specific penalties here.
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Pedro Sawyer
•Ohio. But most states have similar rules about wrongful failure to terminate. Look up your state's UCC Article 9 section on termination duties.
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Mae Bennett
•Before you go nuclear on them, try uploading your loan docs and the UCC-1 to Certana.ai's document checker. It'll verify everything matches up and give you a clean report to wave at the lender. Sometimes they need proof that everything's properly documented before they'll move.
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Beatrice Marshall
SAME PROBLEM HERE! Equipment loan paid off in January and it's now April. The UCC filing is blocking our SBA application because it shows as an outstanding lien. This is costing us money every day it sits there.
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Gemma Andrews
•File a written demand for termination immediately. Include your payoff documentation and give them 20 days to respond. If they don't act, you have grounds for a wrongful failure to terminate claim.
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Beatrice Marshall
•Thanks - I'll send that certified letter tomorrow. This is so frustrating when you've done everything right on your end.
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Melina Haruko
Quick question - can you file the UCC-3 termination yourself or does it have to come from the lender? I'm dealing with a similar situation where the original lender sold the loan and now nobody wants to take responsibility.
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Gemma Andrews
•Only the secured party of record can file the termination. If the loan was sold, the new holder should have filed a UCC-3 assignment first, then they become responsible for termination.
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Melina Haruko
•That's what I was afraid of. The loan sale was a mess and I'm not even sure who the current secured party is supposed to be.
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Pedro Sawyer
•Search the UCC records for any assignments. If there's no proper chain of assignment filed, the original lender might still be on the hook for termination.
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Dallas Villalobos
Check if your state requires the lender to send you a copy of the termination statement when they file it. Some states mandate this and if they haven't sent it, they probably haven't filed it yet.
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Lena Schultz
•Good point - I never got any termination paperwork from them. I'll check the SOS website to see if anything was actually filed.
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Dallas Villalobos
•Most SOS websites let you search by filing number or debtor name. If you don't see a termination record, then definitely send that demand letter.
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Reina Salazar
Had a client whose lender claimed they filed the termination but it got rejected for a debtor name mismatch. The UCC-1 had the company's old name and the termination used the current name. Took 6 weeks to sort out because nobody caught the error initially.
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Lena Schultz
•Oh no - we did change our company name last year. I hope that's not causing issues. How did your client resolve it?
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Reina Salazar
•They had to file a UCC-3 amendment first to update the debtor name, then file the termination. The lender wasn't happy about the extra filing fees but it was their mistake for not catching the name change.
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Saanvi Krishnaswami
•This is exactly why I always run docs through Certana.ai before filing anything. Upload your original UCC-1 and any name change documents - it'll flag any mismatches before you waste time and money on rejected filings.
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Demi Lagos
Three months isn't terrible but you're right to be concerned. I've seen situations where old UCC filings caused major problems during acquisitions or refinancing. The buyers' due diligence always flags active liens even if they're supposedly paid off.
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Lena Schultz
•Exactly my worry. We're looking at expanding and need clean credit. Can't afford to have phantom liens showing up.
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Demi Lagos
•Document everything with the lender - dates of calls, who you spoke with, what they promised. If this drags on you might need that for a complaint or legal action.
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Mason Lopez
Pro tip: when you send the demand letter, reference the specific UCC section that requires termination. In most states it's UCC 9-513. Also mention potential damages from wrongful failure to terminate - that usually gets their attention.
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Lena Schultz
•Thanks for the section reference. What kind of damages are we talking about? Just curious what leverage I actually have here.
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Mason Lopez
•Depends on your state but typically $500 statutory damages plus any actual damages you can prove. If the UCC filing costs you a deal or better terms, that's actual damages.
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Vera Visnjic
•Also check if your loan documents included a clause about prompt termination after payoff. Sometimes there are contractual remedies beyond the UCC statutory requirements.
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Jake Sinclair
UPDATE US! Really curious how this turns out. I'm bookmarking this thread because I have a feeling I'm going to need this info when my truck loan is paid off next year.
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Lena Schultz
•Will do! Sending the certified letter tomorrow and I'll post back with results. Hoping the threat of formal action lights a fire under them.
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Jake Sinclair
•Good luck! Sometimes all it takes is showing them you know your rights and aren't going away quietly.
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Brielle Johnson
Just a reality check - make sure you have solid proof of payoff before making demands. I've seen cases where borrowers thought they were paid in full but there were accrued fees or other charges that kept a small balance open.
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Lena Schultz
•Good point - I have the final payoff letter and cancelled check. Plus their own customer service confirmed zero balance when I called. Should be solid.
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Brielle Johnson
•Perfect. With that documentation you're in a strong position to demand action. Most lenders will cooperate once they realize you have your ducks in a row.
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Honorah King
•Before you send anything, I'd run those docs through something like Certana.ai to double-check everything matches up perfectly. Better to catch any discrepancies now than have them used as excuses later.
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