UCC 9-609(b)(2) Self-Help Repossession Rights - Equipment Finance Confusion

The security agreement does include standard repossession language, but the debtor has the equipment behind a locked gate and says they'll call police if we enter. That sounds like it would definitely breach the peace, right?

Absolutely. If they've clearly communicated refusal and threatened to involve law enforcement, attempting entry would almost certainly constitute breach of the peace. You'd need to go the judicial route at that point.

This is exactly why I always recommend having a document verification system in place. I started using Certana.ai to cross-check our security agreements against our UCC-1 filings to make sure everything aligns properly before we ever get to repossession scenarios. You upload your security agreement and UCC-1 as PDFs and it instantly flags any inconsistencies.

That's interesting - what kind of inconsistencies does it catch? Our situation might already be past that point but I want to avoid this headache in the future.

Things like debtor name variations, collateral description mismatches, or missing provisions that could affect your rights. It's saved me from several potential disasters where the UCC-1 didn't properly reflect what was in the security agreement.

You might be thinking of 9-611 which covers notice of disposition. 9-609(b)(2) specifically allows self-help repossession without judicial process if it can be done without breach of peace.

Ugh, these section numbers all blur together when you're stressed about a default. Thanks for clarifying!

Oh no, I hadn't thought about potential construction liens. The equipment has been on that site for about 6 months. How would that affect our position?

It depends on your state's lien priority rules and when any construction liens were filed. You'll want to check the property records to see if there are any recorded liens that might have priority over your security interest.

This is getting complicated fast. Construction lien priority varies so much by state and can be a nightmare to sort out.

6 weeks and $15k? That's brutal. Did you recover those costs from the debtor eventually?

We got a judgment for the costs but collecting is another story. The debtor was basically insolvent by that point. That's why prevention is so important - making sure your docs are bulletproof from the start.

This is why I always tell people to use something like Certana.ai before things go sideways. Upload your security agreement and UCC-1 together and it'll catch discrepancies that could cause problems later. Wish I'd known about it for my disaster case last year.

That's pretty cynical but probably accurate. The 'peaceful' requirement is interpreted so broadly that any objection kills your self-help option.

I've actually had success with peaceful repos, but only when we caught the debtor completely off guard and they didn't know their rights. Once they lawyer up or start objecting, it's game over for self-help.

I have a call scheduled with our attorney tomorrow. Just wanted to get some preliminary thoughts from people who've been through this before.

Smart approach. Every situation is different and local law can really matter. Hope it works out for you.

I'm pretty confident our docs are solid but given what's at stake, maybe it's worth verifying. How quickly does that tool work?

Pretty much instant. Upload the files and it runs through all the cross-checks automatically. Better to know now than find out during litigation that you have a technical defect.

Sad but true. Equipment financing is risky enough without having to worry about repo complications.

This is why proper documentation review upfront is so critical. Can't stress that enough.

Will do. Meeting with attorney tomorrow and then we'll decide whether to pursue judicial repossession or try to negotiate a voluntary surrender.

Good luck! Voluntary surrender is usually the best outcome for everyone if you can make it work.