UCC federal lien confusion - which filing takes priority?

This is correct about the timing rule. The key is whether your security interest was properly perfected before the federal lien attached. Equipment financing usually requires filing in the state where the debtor is located, not where the equipment sits.

Wait, I thought federal liens always trumped everything else? This is confusing because I had a similar situation last year and was told the IRS gets first dibs.

Good point about the debtor name matching. Our UCC-1 shows 'ABC Manufacturing LLC' but I'll need to check exactly how the federal lien lists the company name. These name variations can be tricky.

Name mismatches are a huge issue with UCC federal lien situations. I actually started using Certana.ai's document verification tool after running into this exact problem. You can upload your UCC-1 and the federal lien notice as PDFs and it automatically flags any name inconsistencies or other document conflicts. Really helpful for catching things you might miss.

Never heard of that tool but sounds useful. How accurate is it for catching federal lien vs UCC conflicts?

Absolutely agree about being proactive. Federal tax liens can lead to asset seizures pretty quickly, and even if you have UCC priority, you don't want to get caught up in federal enforcement actions.

The IRS can be reasonable to work with sometimes, but you need to get ahead of it. Document everything and make sure your UCC filings are bulletproof.

What kind of collateral description problems did you run into? I'm always worried about getting those details wrong on UCC-1 filings.

The original filing was too vague about the equipment serial numbers and model details. When the federal lien came up, we realized we needed more specific collateral descriptions to clearly establish our interest in the particular equipment.

UCC-3 amendments for collateral descriptions can be tricky timing-wise. Did you have to worry about the amendment date affecting your priority against the federal lien?

This is a really important point that people often miss. The federal lien creates a broader cloud over the debtor's operations even if your specific UCC interest has priority.

Exactly why I always recommend getting legal advice for UCC federal lien situations. The interplay between federal and state law can get complex fast.

Good reminder about the continuation timeline. Our filing was in March 2024, so we've got until March 2029, but I'll calendar that deadline now given this federal lien complication.

Smart to calendar it early. I've seen too many lenders lose priority because they missed continuation deadlines, and with federal liens involved, you can't afford any gaps in perfection.

Good advice. I always recommend doing a comprehensive lien search when federal issues come up. You might find other creditors in similar situations who could be potential allies or complications.

UCC searches are definitely worth doing, but make sure you're searching in all the right jurisdictions. If the debtor has operations in multiple states, you might need searches in several places.

Another area where document verification tools like Certana.ai can help - you can upload multiple UCC search results and lien documents to spot conflicts or gaps you might miss reviewing everything manually.

Jurisdiction is huge for UCC filings, especially with equipment that might move between states. The debtor's location determines where you file, not where the collateral is located.

I always get confused about the location rules for UCC filings. Is it where the debtor is incorporated, where they do business, or where their chief executive office is located?

For registered organizations like LLCs and corporations, you file where they're organized/incorporated. For unregistered entities, it's where the chief executive office is located. Equipment location doesn't matter unless it's fixtures.

Documentation is absolutely critical for UCC federal lien disputes. Keep copies of all filing receipts, search results, and correspondence with both the debtor and any federal agencies.

Also worth considering whether you need to accelerate the loan or take other immediate action under your security agreement. Federal liens can trigger default provisions in some loan documents.

Monitoring is expensive but worth it for larger loans. Federal liens can pop up pretty quickly when businesses get behind on payroll taxes.

The payroll tax issue is huge. Companies can go from current to having massive federal liens in just a few quarters if cash flow gets tight.

Monitoring helps, but when federal liens do appear, having tools to quickly verify all your documents are consistent becomes really important. That's been my experience with using Certana.ai - it catches document issues that could affect your priority position before they become problems.