UCC 9-616 required for consumer goods termination - confused about notice requirements

Thank you! That's really helpful. So the one month clock started when the SOS accepted our UCC-3 filing? We filed it on January 15th so I still have time. Do you have any language recommendations for the actual notice content?

Exactly - the clock starts when the termination is filed and accepted. For the language, keep it simple and direct. Something like 'This notice is to inform you that a UCC termination statement was filed on [date] with the [state] Secretary of State office, terminating the financing statement filed on [original filing date] under filing number [number]. The terminated financing statement covered [brief description of collateral].' Make sure to include your contact information too.

I always include the debtor's name exactly as it appeared on the original UCC-1 in these notices. Sometimes there are variations and you want to be crystal clear which financing statement you're referring to.

No, you're thinking of UCC 9-613 which is the notice for disposition of collateral after default. UCC 9-616 requires automatic notice to consumer debtors when you file a termination statement, regardless of whether they requested it. It's designed to make sure consumers know their collateral has been released.

Oh wow, I need to review our procedures immediately. We've probably missed dozens of these notices. Is there any penalty for not sending them?

The UCC doesn't specify monetary penalties but it could create liability issues if a consumer is harmed by not knowing about the termination. Plus it's just good customer service to let them know their collateral is free and clear.

That's a great idea. I want to make sure our notice is accurate before sending it out. Did you find any other issues when you ran the document check?

It flagged that our debtor name had a middle initial on the UCC-1 but not on our internal loan documents. Small thing but important for the consumer notice to reference the exact debtor name from the filed UCC-1. The tool is pretty quick - just upload PDFs and it highlights any inconsistencies.

I get the frustration but the consumer protections exist for good reasons. Most consumers don't understand UCC filings and might not even realize their property was used as collateral. The notice requirement helps ensure they know when the lien is released.

I suppose you're right. It's just another thing to track and document. At least it's only for consumer goods and not all our commercial equipment deals.

Good question. UCC 9-616 applies to all consumer goods financing, including vehicles. However, vehicle financing often has additional title-related requirements that might overlap with the UCC notice requirement. You should check your state's specific rules for vehicle lien releases.

Thanks, that makes sense. We already send title lien release notices for vehicles so we're probably covered, but I'll double-check with our compliance team.

That's a complex situation. The UCC 9-616 notice should still be sent since the financing statement was terminated. I'd recommend sending it to both the estate representative (if you have that information) and the debtor's last known address. You might want to consult with your legal counsel on this specific scenario.

We had a similar case and our attorney advised sending to the estate representative with a copy to the original address. The goal is to ensure someone with authority over the debtor's affairs receives the notice.

That's really smart. I'm going to set up something similar. Do you include the certified mail tracking numbers in your spreadsheet too?

Yes, I have columns for mail tracking number and delivery confirmation date. It's especially important if you ever need to prove you sent the notice within the required timeframe.

Good point. In our case it's just the one UCC-1 for household goods, but I can see how that could be confusing with multiple filings. I'll make sure to include the specific filing number and date.

This is where having a document verification tool like Certana.ai really helps. You can upload all the related UCC documents to make sure you're referencing the right filing numbers and dates in your consumer notice.

I haven't seen any specific proposed changes to UCC 9-616, but there's always discussion about enhancing consumer protections in secured transactions. The best practice is to follow current requirements and stay tuned to UCC updates from your state's Secretary of State office.

Makes sense. I'll keep an eye on the UCC updates. For now, I'll stick with the current notice requirements.

Great to hear you got it sorted out! Updating your procedures is smart - it's easy to forget about the consumer notice requirement when you're used to commercial filings.

Excellent follow-up. Having good procedures for consumer goods terminations will save you time and stress on future deals.