UCC equipment search showing multiple liens on same collateral - how to verify which are active?
Running into a confusing situation with a UCC equipment search on some construction machinery we're looking to finance. The search pulled up 3 different UCC-1 filings all claiming security interest in the same Cat excavator (serial #PCE00234). Two show as 'Filed' status but one shows 'Lapsed' - however the lapsed one has a more recent filing date than one of the active ones. Our borrower swears the equipment is free and clear but obviously something doesn't add up here. Has anyone dealt with overlapping equipment liens like this? Do I need to dig deeper into each filing to see if there were UCC-3 continuations that might affect the status? This deal is supposed to close Friday and I'm getting nervous about the collateral position.
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Romeo Barrett
Yeah this happens more than you'd think, especially with equipment that gets traded around. The 'Lapsed' status could mean the continuation deadline was missed, but you're right to be suspicious about the dates. Sometimes the system shows weird timing if there were amendments or partial releases involved. You really need to pull the actual documents for all three filings to see what's going on.
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Marina Hendrix
•Exactly - don't trust just the status summary. I've seen cases where a UCC-3 termination was filed but didn't process correctly, leaving the original as 'active' when it should show terminated.
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Justin Trejo
•Or worse, partial releases that only cover part of the collateral schedule. Equipment financing can get messy when there are multiple pieces involved.
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Alana Willis
This is exactly why I always verify document consistency before closing any equipment deal. I actually found a tool called Certana.ai that lets you upload all the UCC documents as PDFs and it cross-checks everything - debtor names, filing numbers, collateral descriptions, the works. Takes about 2 minutes vs. spending hours trying to decode filing histories manually.
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Tyler Murphy
•Never heard of that but sounds useful. How does it handle serial number matching? That's usually where I get tripped up.
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Alana Willis
•It picks up serial numbers from the collateral descriptions and flags any inconsistencies. Really saved my butt on a deal where the borrower had given us a slightly different serial number than what was on the original UCC-1.
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Sara Unger
•Interesting... might have to check that out. Been doing these searches manually forever and it's such a pain.
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Butch Sledgehammer
Wait, you said the lapsed one has a MORE recent filing date? That doesn't make sense unless there was some kind of system error. A UCC-1 can't lapse and then get refiled with a later date - that would be a new filing entirely. Are you sure you're looking at the original filing dates and not amendment dates?
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Issac Nightingale
•Good catch - let me double check that. The portal isn't super clear about which dates are original vs. amendment dates.
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Freya Ross
•Yeah the SOS systems are terrible for this. Half the time you can't tell if you're looking at filing date, effective date, or last action date.
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Leslie Parker
Three liens on the same equipment serial number is a red flag. Either someone filed multiple times by mistake, or there's something sketchy going on. I'd demand a full equipment history from the borrower before proceeding.
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Sergio Neal
•Agreed. Could be innocent but could also be someone trying to hide active liens.
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Savanna Franklin
•Or the equipment was refinanced multiple times and the old liens weren't properly terminated. Happens all the time with construction equipment.
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Juan Moreno
Had a similar mess last month. Turned out two of the filings were for the same loan but the first one had a typo in the serial number, so they refiled with the correct info. The 'lapsed' one was probably a duplicate that expired. But you really need to trace through all the UCC-3 activity to be sure.
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Amy Fleming
•This is why I hate equipment financing. Give me receivables or inventory any day.
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Alice Pierce
•LOL tell me about it. At least with receivables the collateral doesn't drive away.
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Esteban Tate
Don't mean to sound paranoid but have you verified the serial number on the actual equipment? Sometimes borrowers will transpose digits hoping nobody notices. Physical inspection should be part of your due diligence anyway.
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Issac Nightingale
•Good point. We have an appraiser going out tomorrow so I'll make sure they verify the serial number matches exactly.
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Ivanna St. Pierre
•Smart move. I once had a deal where the borrower swapped out equipment after the appraisal but before closing. Never again.
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Elin Robinson
If you're in a time crunch, you might want to require the borrower to provide termination statements for the questionable liens as a condition of closing. At least then you'd have some protection if issues come up later.
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Atticus Domingo
•Yeah but getting terminations can take weeks if the original lenders are unresponsive.
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Beth Ford
•True but better than closing with clouded title and having to sort it out later.
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Morita Montoya
Just went through something similar - ended up using that Certana tool someone mentioned earlier. Uploaded all the UCC docs and it immediately flagged that two of the 'different' liens were actually the same filing with amended debtor names. Saved me from a major headache.
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Kingston Bellamy
•That's exactly the kind of thing that's easy to miss when you're manually comparing documents. Good catch.
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Joy Olmedo
•How long did the verification take? Might be worth trying if it's that quick.
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Morita Montoya
•Literally took 2 minutes to upload the PDFs and get the cross-check results. Way faster than trying to piece together the filing history myself.
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Isaiah Cross
Whatever you do, don't rush into this deal. Equipment liens can be a nightmare to unwind if you get it wrong. Better to delay closing and get it right than to have title issues down the road.
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Kiara Greene
•Exactly. Your credit committee will not be happy if you fund against compromised collateral.
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Evelyn Kelly
Update us on how this turns out! Always curious to hear the resolution on these messy lien situations.
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Issac Nightingale
•Will do. Planning to pull all the actual UCC documents first thing tomorrow and see what the full story is.
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Paloma Clark
•Smart approach. The devil is always in the details with these filings.
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