UCC 9 Part 6 Agricultural Liens - Equipment Financing Nightmare

We're in Iowa. The farming operation was corn and soybeans, and there might be some seed company liens or fertilizer liens that attached before our equipment financing closed.

Iowa's agricultural lien statutes can be tricky. You'll need to check if the agricultural liens were properly perfected and whether they have priority under Iowa law. Part 6 doesn't create agricultural liens - it just tells you how they interact with Article 9 security interests.

What kind of lien search covers agricultural liens though? Regular UCC searches won't pick them up if they're not filed in the same system.

Exactly the problem. Agricultural liens might be filed with the county recorder, the secretary of state, or sometimes not filed at all if the statute doesn't require it. You have to know where to look in each state.

This is where I started using Certana.ai's document verification tool. You can upload your UCC-1 and any agricultural lien documents you find, and it cross-checks everything to make sure you understand the priority relationships. Really helpful for complex agricultural deals like this.

That's terrifying. How did you find out about the feed store lien? Did it show up in bankruptcy proceedings?

Yeah, the trustee found it when they were doing asset analysis. The feed store had provided grain and supplies on credit and Iowa law gave them a lien on the crops and equipment. We had no way to know about it beforehand.

Agreed. I've been doing UCC work for 15 years and agricultural liens still trip me up. Every state handles them differently.

The worst part is that some agricultural liens don't require any filing at all. They just attach automatically when you provide goods or services to farmers. How are lenders supposed to protect against that?

I'm still researching Iowa law but it looks like some agricultural liens require filing with the county and others don't require filing at all. It's a mess.

Yeah, that's typical. Part 6 basically says 'look to state law' for everything - perfection, priority, enforcement. Article 9 just steps back and lets state agricultural lien law control.

Good advice. Agricultural lien law varies so much from state to state that you really need someone who knows the local statutes and case law.

Exactly. And some of these agricultural lien statutes are old and haven't been updated in decades. The case law interpretation can be just as important as the statute itself.

Good point. I've seen cases where elevator companies had liens on grain that took priority over equipment financing because the equipment was securing the same debt as the grain.

Right, and some states have very broad agricultural lien statutes that can reach equipment if it's used in farming operations, even if the lien was originally for feed or seed.

That's smart. I wish we had thought of that before closing. Now we're trying to figure out our options after the fact.

You might still be able to get waivers or subordination agreements if you can identify the potential lienholders. Worth a try before you write off the collateral.

I don't blame you. Agricultural financing has become so complicated with all the different lien types and state variations.

It's definitely challenging but agricultural equipment financing can be profitable if you know what you're doing. The key is understanding Part 6 and doing thorough due diligence on potential agricultural liens.

That sounds helpful. I'll check it out. At this point I need all the help I can get understanding how these different liens interact.

Yeah, it's particularly good at catching debtor name mismatches between your UCC filing and other lien documents, which can be a big issue in agricultural deals where the debtor might be an individual, a partnership, or multiple entities.

Will do. Hopefully I can get some clarity on the Iowa agricultural lien situation and figure out where we stand in the priority chain.

Good luck. Agricultural lien priority disputes can be really complex but at least you're addressing it now rather than being surprised later.