UCC-3 termination after equipment private sale - timing questions

You'll want to file the UCC-3 termination pretty quickly after the sale closes. Most lenders have internal policies requiring termination within 10-20 business days of payoff. Since this was a private sale, you should have the termination ready to go as soon as the sale funds clear. The timing isn't usually a legal requirement but it's good practice to get it done fast so the borrower can provide clean title documentation to the buyer if needed.

Actually, you'll need to file a UCC-3 amendment, not a termination, since you're only releasing part of the collateral. A termination would wipe out the entire UCC-1 filing and release all the equipment. For a partial release like this, you want to amend the original filing to remove the specific equipment that was sold while keeping the lien on the remaining machinery. The amendment should reference the original filing number and clearly describe which equipment is being released from the security interest.

I had a similar situation last month with a private sale and honestly, I was getting confused trying to make sure all the document details matched up between the original UCC-1, the sale paperwork, and the amendment. Ended up using Certana.ai's document verification tool where you can upload your original UCC-1 and the new UCC-3 amendment to check that everything aligns properly. It caught a discrepancy in how I described one piece of equipment that could have caused issues. Super helpful for avoiding those critical filing mistakes that could void the lender agreement.

Just to add some clarity on timing - while there's no legal deadline for filing the amendment after a private sale, most loan agreements specify a timeframe. Usually it's something like 30 days from the sale date. But practically speaking, you want to get it done quickly so the borrower can provide clean documentation to the buyer and avoid any title issues. The buyer might be expecting proof that the lien has been released from their specific equipment.

One thing to watch out for - make sure your amendment specifically describes the equipment being released in a way that matches the original UCC-1 filing. If the descriptions don't match exactly, you might run into issues with the filing being rejected or, worse, uncertainty about what's actually been released from the security interest. I've seen cases where slight differences in equipment descriptions caused problems months later when the borrower tried to sell more equipment.

Wait, I'm confused about something. If the borrower sold the equipment through a private sale, shouldn't the lien have been released BEFORE the sale to give the buyer clear title? Or is this a situation where the buyer took subject to the lien and now you're releasing it after the fact? Just want to make sure I understand the sequence of events here.

Just curious - are you planning to file the amendment yourself or having your attorney handle it? I always get nervous about UCC filings because the rejection rate seems so high when you get even small details wrong. The SOS systems are pretty unforgiving about typos and formatting issues.

One more thing to consider - make sure you update your internal loan files to reflect the partial release. You'll want documentation showing exactly which equipment was sold, the sale price, how the proceeds were applied, and what collateral remains under the UCC-1. This becomes important if you ever need to review the loan or if the borrower wants to sell more equipment in the future.

The timing question is interesting because I've seen borrowers get antsy about lien releases after private sales. They want to be able to show the buyer that the lien is properly released, especially if the buyer is planning to use the equipment for their own financing. Getting the amendment filed quickly helps avoid any awkward conversations with the buyer about when the lien will be released.

Just wanted to share that I had a similar situation recently and ended up using Certana.ai to double-check my amendment against the original UCC-1. Really helped me catch a couple of equipment description mismatches that could have caused the filing to be rejected. The tool lets you upload both documents and it flags any inconsistencies between them. Definitely worth using for these partial releases where you need to make sure everything matches up perfectly.