Need help understanding what is a UCC foreclosure process after lender default notice

A UCC foreclosure is totally different from real estate foreclosure. Under Article 9, when you default on a secured loan, the lender can repossess and sell your collateral (equipment, inventory, accounts receivable, etc.) without going to court first. They have to give you reasonable notice of the sale and conduct it in a 'commercially reasonable' manner, but the process is much faster than real estate foreclosure.

I went through this exact situation 2 years ago with our delivery trucks. The lender sent default notices, then 10 days later they had a repo company come get the vehicles. What saved us was finding out our UCC-1 filing had the wrong business name - it said 'ABC Delivery LLC' but our official name was 'ABC Delivery Services LLC.' That one word difference made their security interest invalid and we negotiated a payment plan instead of losing the trucks.

COMMERCIAL REPOSSESSION IS BRUTAL. They don't have to give you months of notices like with your house. I've seen businesses lose everything in 30 days. The 'commercially reasonable' sale requirement is a joke - they'll sell your $50K equipment for $15K at some dealer auction and you still owe the difference.

Here's what you need to know about the timeline: After default, they must give you notice of their intent to dispose of collateral. For private sales, that's typically 10-14 days notice. For public auctions, they need to tell you the time and place. You have the right to redeem the collateral by paying the full balance before the sale. You also have the right to receive an accounting of what they sold it for.

Check your loan documents carefully! Sometimes there are notice requirements beyond what the UCC requires. Also look at the collateral description on the UCC-1 filing - if it's too vague or doesn't properly describe your equipment, their security interest might not be perfected properly.

Had a similar scare last year when our SBA lender threatened UCC foreclosure. Turns out their UCC-3 continuation statement was filed late and their security interest had lapsed. We discovered this by accident when reviewing all the filings. Made a huge difference in our negotiations.

this is so confusing why do they make it so complicated?? can't they just work with people instead of taking everything away immediately?

One thing people don't realize - you can object to the sale if it's not commercially reasonable. If they sell your equipment for way below market value without proper advertising or at a weird time/place, you might have grounds to challenge it. But you need to act fast and document everything.

Get a lawyer immediately. UCC foreclosure moves fast and once they sell your collateral, it's usually too late to fix problems with the filing or process. Even if you find issues with their security interest later, recovering your equipment becomes much harder.

Before you panic, double-check all the UCC filings and your loan documents. I've seen cases where lenders think they have a valid security interest but there are problems with the paperwork. Name mismatches, improper continuation filings, insufficient collateral descriptions - these issues can give you leverage in negotiations even if they don't completely invalidate the security interest.

I'm sorry you're going through this stress - UCC foreclosures can be overwhelming because they move so fast compared to what most people expect. Based on what others have shared here, it sounds like you have some potential avenues to explore before they can take your equipment. The name discrepancy issue that several people mentioned could be really important - if your UCC-1 was filed under your DBA name but your loan is with your legal entity name, that might give you some negotiating power. Also definitely check if they filed any required continuation statements if it's been over 5 years since the original filing. Even if you find issues that don't completely stop the foreclosure, they could give you leverage to negotiate a payment plan or modification. The key is acting quickly since once they sell the equipment, your options become much more limited. Document everything and get that legal consultation ASAP.