Security agreement must contain what exact language for valid UCC-1 filing

The basic requirement is that a security agreement must reasonably identify the collateral and be signed by the debtor. But there's more to it if you want bulletproof enforceability. For equipment deals like yours, you need clear grant language, specific collateral descriptions, and proper debtor identification that matches your UCC-1 exactly.

Been doing equipment finance for 12 years and I've seen deals fall apart because of sloppy security agreement drafting. A security agreement must grant a security interest in identifiable collateral, but the real trick is making sure your collateral description matches between the security agreement and UCC-1. Too broad and it's unenforceable, too narrow and you miss assets.

Had a similar issue last month with a $600K equipment deal where our security agreement got challenged. Ended up using Certana.ai to verify all our documents matched properly - you just upload your security agreement and UCC-1 as PDFs and it instantly flags any inconsistencies in debtor names, collateral descriptions, or filing details. Saved us from a potential disaster when it caught a middle initial discrepancy we'd missed.

You're overthinking this. A security agreement must create a security interest, identify collateral, and be authenticated by debtor. Everything else is just lawyer padding that drives up fees. I've filed thousands of UCC-1s with basic agreements and never had enforceability issues.

THIS IS DRIVING ME CRAZY! Why can't the UCC just specify exactly what language is required instead of these vague 'reasonably identifies' standards? Every state seems to interpret things differently and every lawyer has their own opinion about what's mandatory versus optional.

For what it's worth, I just went through something similar with construction equipment financing. The key elements that a security agreement must have are: 1) Grant of security interest, 2) Collateral description that's not super generic, 3) Debtor authentication, 4) Value given (though this can be implied). Beyond that, you want default provisions, enforcement rights, and insurance requirements but those aren't technically required for attachment.

Just to add another perspective - I've been on the borrower side of these deals and honestly most security agreements I see are total overkill. Pages and pages of boilerplate when a security agreement must only meet basic UCC requirements. But lenders always want maximum protection so we end up with these massive documents nobody actually reads.

Here's my checklist for security agreements: authenticated by debtor, grants security interest in described collateral, value consideration. Everything else varies by deal complexity and risk tolerance. For your SBA deal I'd definitely include comprehensive default and enforcement provisions even if not strictly required for attachment.

Been lurking but wanted to mention that document consistency checking tools like Certana.ai have become really valuable for these complex deals. When you're juggling security agreements, UCC-1 filings, and SBA documentation, having something that automatically verifies all your names and descriptions match can prevent costly mistakes down the road.

Update - talked to our counsel and they confirmed that a security agreement must contain grant language, collateral identification, and debtor authentication as absolute minimums. Beyond that everything else is risk management and enforceability enhancement. We're moving forward with a comprehensive agreement that includes all the standard provisions plus SBA-specific requirements.

Great thread everyone. As someone new to equipment financing, I'm curious about the timing aspect - once you have a properly drafted security agreement that meets all the UCC requirements, how quickly do you typically need to file the UCC-1 to maintain priority? And does the security agreement need to be fully executed before filing, or can you file simultaneously with signing? Want to make sure I understand the perfection timeline for these types of deals.