Missed the closing date for UCC forms - equipment financing fell through
Our SBA loan officer just informed us that we missed some kind of closing date for UCC forms and now our $180K equipment financing package is in jeopardy. The dealership had assured us everything was filed properly back in October, but apparently there's a 5-year continuation deadline we weren't aware of. The original UCC-1 was filed in 2020 and we never received any notices about needing to file a continuation. Now the lender is saying our security interest may have lapsed and they're reconsidering the entire loan approval. Has anyone dealt with this kind of situation? Is there any way to fix this or are we completely out of luck? The equipment delivery was supposed to happen next week and we've already made partial payments.
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Sophia Carter
Oh wow, this is exactly what happened to my brother's construction company last year! The 5-year rule is brutal - UCC-1 filings automatically expire unless you file a UCC-3 continuation within 6 months before the 5-year anniversary. If it's truly lapsed, the lender lost their secured position. Did they give you the exact filing date of the original UCC-1? That's your starting point.
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Aaron Boston
•They said it was filed October 15, 2020, so I guess the deadline was October 15, 2025? We're past that now. The dealership never mentioned any of this during the financing process.
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Chloe Zhang
•Wait, that deadline would be coming up soon, not passed yet. Are you sure about those dates? The continuation window opens 6 months BEFORE the 5-year mark, so April 2025 would have been when they could start filing the UCC-3.
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Brandon Parker
This sounds like a communication breakdown between your dealership and lender. Honestly, most equipment dealers handle UCC continuations automatically for their financing partners. Something went wrong in the process. You need to get copies of all the original filings immediately - the UCC-1, any amendments, and check if there were any continuation attempts that got rejected.
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Aaron Boston
•How do I get copies of the filings? The lender is being pretty vague about the details and just saying 'the security interest lapsed.
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Brandon Parker
•You can search your state's UCC database online - most Secretary of State offices have public search portals. Search by your company name as debtor or the financing statement number if you have it.
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Adriana Cohn
•Also check if there were any rejected continuations. Sometimes they get rejected for debtor name mismatches or missing information, and if nobody caught it in time, you'd be in this exact situation.
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Jace Caspullo
I've seen this exact scenario play out and there might be options depending on your state's rules. Some states allow late continuations with specific procedures, though it's not common. The bigger issue is whether your lender will work with you on refiling or if they're going to walk away from the deal entirely. Equipment financing without proper UCC perfection is pretty risky for them.
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Melody Miles
•True, but if the collateral is still identifiable and in the debtor's possession, they might be able to refile a new UCC-1 and continue with the financing. It's not ideal but it's not necessarily dead in the water.
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Aaron Boston
•The equipment hasn't been delivered yet, so technically we don't even have possession. This is getting more complicated by the hour.
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Nathaniel Mikhaylov
Before you panic too much, I'd recommend using something like Certana.ai to verify exactly what's on file. You can upload all your financing documents and it'll cross-check everything against the UCC filings to see if there are discrepancies you're not aware of. I used it when we had a similar scare with our manufacturing line financing and found out the issue was actually a debtor name mismatch that was fixable.
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Aaron Boston
•Never heard of that service. Is it expensive? We're already stretching the budget with this equipment purchase.
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Nathaniel Mikhaylov
•It's pretty affordable for document verification. You just upload your PDFs and it automatically checks for inconsistencies between your charter, loan docs, and UCC filings. Saves a lot of time compared to manual review.
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Eva St. Cyr
•I've used similar services and they're worth it just for peace of mind. Better to spend a little on verification than lose a six-figure equipment deal.
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Kristian Bishop
The dealership should be taking some responsibility here if they were supposed to handle the UCC filings as part of the financing package. Most equipment dealers have relationships with filing services that handle continuations automatically. Did you get anything in writing about who was responsible for maintaining the UCC filings?
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Aaron Boston
•Looking through our paperwork now. There's mention of 'ongoing filing maintenance' but it's pretty vague about who does what.
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Kristian Bishop
•That's probably going to be your leverage with the dealership. If they promised to handle filings and didn't follow through, they might be liable for the damages.
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Kaitlyn Otto
I hate to be the bearer of bad news, but if the UCC-1 truly lapsed, your lender is now an unsecured creditor for that equipment loan. That changes their risk profile completely and they might require additional collateral or guarantees to move forward. The equipment itself can't secure the loan if the lien wasn't properly maintained.
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Axel Far
•This is why I always tell people to track their own UCC filings regardless of who's supposedly handling them. Set calendar reminders at the 4-year mark to verify continuations are being filed.
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Aaron Boston
•Wish I had known about this 5-year rule before we got this deep into the process. Nobody mentioned it during any of the financing discussions.
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Kaitlyn Otto
•Unfortunately it's one of those things that everyone assumes someone else is handling until something goes wrong.
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Jasmine Hernandez
Check your state's specific rules on lapsed UCC filings. I know in some states there are grace periods or revival procedures, though they're rare. Also verify that the original filing was actually valid - sometimes what looks like a lapsed continuation is actually an issue with the original UCC-1 that made subsequent filings ineffective.
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Aaron Boston
•How would I know if the original UCC-1 was invalid? It's been on file for 5 years.
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Jasmine Hernandez
•Common issues are debtor name mismatches with your official entity name, incorrect addresses, or overly broad collateral descriptions that make the filing ineffective. A UCC search will show what's actually on file versus what should be there.
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Luis Johnson
Whatever you do, don't let the lender just walk away without exploring all options. They have a significant investment in this deal too and might be willing to work out alternative security arrangements. Maybe personal guarantees, additional collateral, or a higher interest rate to offset the increased risk.
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Aaron Boston
•The loan officer mentioned something about 'alternative structures' but didn't give specifics. I'm meeting with them tomorrow to discuss options.
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Luis Johnson
•Good. Go in with a clear understanding of what went wrong with the UCC filings so you can address their concerns directly. They'll be more willing to work with you if you show you understand the issue and have a plan to prevent it in the future.
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Ellie Kim
I went through something similar with a fleet financing deal. The key is to act fast and get all the documentation sorted out immediately. We ended up having to refile everything from scratch and delay the equipment delivery by 6 weeks, but we saved the deal. The lender appreciated that we took ownership of the problem instead of pointing fingers.
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Aaron Boston
•Six weeks delay would be painful but manageable. Did you have to change any of the loan terms?
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Ellie Kim
•Yeah, they bumped the rate by about 0.5% to account for the additional risk during the gap period. Not ideal but better than losing the financing entirely.
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Fiona Sand
For future reference, there are services that monitor UCC filings and send automatic renewal notices. Certana.ai has a document verification tool that can catch these kinds of discrepancies before they become problems. You upload your loan documents and UCC filings and it flags any inconsistencies or upcoming deadlines. Would have caught this issue months ago.
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Mohammad Khaled
•Definitely something to consider for the next equipment purchase. These kinds of technical filing issues can kill deals even when everyone thinks they're doing everything right.
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Aaron Boston
•Adding that to my list of things to research once we get through this current crisis. Thanks for the tip.
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Alina Rosenthal
Just want to add that this is exactly why a lot of companies are moving away from equipment dealers handling their UCC filings. Too many moving parts and too much room for miscommunication. Consider working directly with a filing service or having your attorney handle it going forward.
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Aaron Boston
•That makes sense. The dealer probably handles dozens of these deals and it's easy for something to slip through the cracks.
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Finnegan Gunn
•Especially with the 5-year continuation deadlines. It's a long time to keep track of, and staff turnover means the person who filed the original UCC-1 might not even be there when the continuation is due.
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Alina Rosenthal
•Exactly. That's why automated systems and direct relationships with filing services are becoming more popular. Takes the human error element out of the equation.
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