UCC filing confusion - security agreement may cover after-acquired property of the debtor but collateral description rejected?
Running into a wall here with my UCC-1 filing. Bank's security agreement specifically states it covers after-acquired property of the debtor (standard language in our commercial loan docs), but when I tried to file the UCC-1 with collateral description mentioning after-acquired equipment and inventory, it got rejected by the SOS office. The rejection notice said "collateral description too broad" but isn't this exactly what security agreements are supposed to cover? I've been doing these filings for 8 years and never had this issue before. The loan is for $850K and we need this perfected ASAP since the borrower is expanding their manufacturing operations next month. Anyone else dealing with stricter collateral description requirements lately? What's the magic language that gets these through without being overly specific?
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Mateo Martinez
I had the exact same issue last month! After-acquired property language is totally standard but some SOS offices are getting pickier about how it's described. Try being more specific about the types of after-acquired property - like 'all equipment now owned or hereafter acquired' instead of just 'after-acquired property.' Also make sure you're not mixing up the security agreement language with what actually needs to go on the UCC-1 form.
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Aisha Hussain
•This is helpful - I've been copying the exact security agreement language into the UCC-1 and maybe that's my problem. Should the collateral description be shorter than what's in the underlying security agreement?
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Mateo Martinez
•Exactly! The UCC-1 collateral description can be broader than the security agreement, but it needs to be clear enough that someone searching the records can understand what's covered. The security agreement can have all the detailed after-acquired property language, but the UCC-1 just needs to give reasonable notice.
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Ethan Clark
Which state are you filing in? Some states have gotten really strict about after-acquired property descriptions lately. In Ohio, they started rejecting anything that says 'all personal property' even though that's perfectly valid under Article 9. You might need to break it down by category - inventory, equipment, accounts receivable, etc.
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Nia Wilson
•This is in Michigan. The original description was 'All inventory, equipment, accounts, chattel paper, instruments, documents, deposit accounts, and general intangibles, now owned or hereafter acquired.' Seemed pretty standard to me but apparently not specific enough for their taste.
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Ethan Clark
•Michigan has been tightening up on these. Try removing 'general intangibles' and being more specific about the equipment types if you can. Sometimes they want to see 'manufacturing equipment' or 'office equipment' rather than just 'equipment.
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StarStrider
•Wait, why would they reject 'general intangibles'? That's straight from the UCC definitions. This is getting ridiculous if we can't use the actual statutory language.
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Yuki Sato
Had a similar nightmare with after-acquired property descriptions getting rejected. Spent weeks going back and forth with the filing office. Finally found this tool called Certana.ai that checks your UCC documents before filing - it caught issues with my collateral description that would've caused another rejection. You just upload your security agreement and UCC-1 draft, and it flags potential problems. Saved me from another round of rejections and delays.
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Nia Wilson
•Never heard of Certana.ai - does it actually understand the nuances of different state filing requirements? This Michigan rejection caught me completely off guard.
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Yuki Sato
•Yeah, it's pretty sophisticated. It cross-references your documents against state-specific requirements and flags things like overly broad collateral descriptions or debtor name mismatches. For after-acquired property issues, it suggests alternative language that's more likely to get accepted. Worth trying before you refile.
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Carmen Ruiz
This is exactly why I hate dealing with UCC filings! The rules are supposed to be uniform but every state has their own quirks. A security agreement may cover after-acquired property of the debtor - that's basic secured transactions law - but good luck explaining that to some filing clerk who's having a bad day.
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Andre Lefebvre
•Right?? The whole point of the UCC was to make this stuff uniform across states. Now we're back to having to learn each state's individual preferences.
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Carmen Ruiz
•Exactly! And don't even get me started on continuation filings. Half the time they reject those for the stupidest reasons too.
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Zoe Alexopoulos
•At least with continuations you know what you're dealing with - just renewing an existing filing. These collateral description rejections are completely unpredictable.
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Jamal Anderson
Try this language: 'All inventory, equipment, accounts, deposit accounts, chattel paper, instruments, and documents, whether now owned or hereafter acquired by debtor.' I've had good luck with that format in Michigan. The key is being specific about the property types but clear about the after-acquired aspect.
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Nia Wilson
•That's almost identical to what I used except I included general intangibles. Maybe that was the problem? Seems weird that they'd reject standard UCC terminology.
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Jamal Anderson
•General intangibles can be tricky because it's so broad. If your security agreement covers specific types of intangibles like patents, trademarks, or software, try listing those instead of the catch-all term.
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Mei Wong
I'm dealing with something similar but my problem is the debtor name matching. The security agreement has the full corporate name but the UCC-1 got rejected because of a slight variation. These systems are so picky now it's insane.
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QuantumQuasar
•Debtor name issues are the worst! I always pull a fresh Secretary of State record before filing to make sure I have the exact legal name.
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Mei Wong
•I thought I did that but apparently there was some punctuation difference. Now I'm paranoid about every comma and period in the name.
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Yuki Sato
•This is another thing Certana.ai catches - it compares the debtor name on your UCC-1 against the security agreement and flags any discrepancies. Really helpful for avoiding those annoying name-related rejections.
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Liam McGuire
Maybe try breaking down your collateral description into separate categories? Instead of one long list, do separate lines for inventory, equipment, accounts, etc. Some filing systems handle that better than comma-separated lists.
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Nia Wilson
•That's worth trying. The rejection notice wasn't very specific about what exactly was too broad, so maybe it's a formatting issue rather than a substantive one.
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Amara Eze
•I've seen that work before. Some states prefer the clean separation rather than everything crammed into one description field.
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Giovanni Greco
Quick question - are you sure your security agreement actually covers after-acquired property? Sometimes the language looks like it does but doesn't meet the technical requirements. Worth double-checking before you refile the UCC-1.
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Nia Wilson
•Definitely covers it - standard bank form with explicit after-acquired property language. The security agreement isn't the issue, it's translating that into acceptable UCC-1 collateral description language.
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Giovanni Greco
•Got it. Just wanted to make sure since I've seen people assume after-acquired coverage when it wasn't actually there. Sounds like you're good on that front.
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Fatima Al-Farsi
Had to laugh at 'magic language' - that's exactly what it feels like sometimes! I keep a file of successful collateral descriptions for different states because you never know what's going to work.
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Dylan Wright
•Smart approach! I should start doing that too. Every successful filing is like finding gold these days.
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Fatima Al-Farsi
•Exactly! And I always save the rejection notices too so I know what NOT to do next time.
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Sofia Torres
Update: Just tried the Certana.ai tool mentioned earlier and wow, it caught three potential issues with my revised UCC-1 before I refiled. Turns out the after-acquired property language wasn't the only problem - there was also a minor debtor name discrepancy I missed. Really glad I checked before submitting again and risking another rejection.
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GalacticGuardian
•That's awesome! How quickly does it analyze the documents? I've got a filing deadline coming up fast.
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Sofia Torres
•Pretty much instant once you upload the PDFs. It generates a report showing any inconsistencies between your security agreement and UCC-1, plus flags potential filing issues. Definitely worth the peace of mind.
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Dmitry Smirnov
•I was skeptical about these automated tools but if it's catching stuff human reviewers miss, might be worth trying. These rejections are costing us too much time and money.
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Ava Rodriguez
Final update - refiled with more specific collateral categories and cleaned up the debtor name issue. UCC-1 was accepted this time! Thanks everyone for the suggestions. For anyone else dealing with after-acquired property description rejections, definitely be more specific about property types rather than using broad categories, and double-check every character in the debtor name.
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Mateo Martinez
•Congrats! Always feels good when these finally go through. What was the final collateral description language that worked?
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Ava Rodriguez
•Ended up with separate lines for each category: 'All inventory now owned or hereafter acquired by Debtor,' 'All equipment now owned or hereafter acquired by Debtor,' etc. Much cleaner than my original version.
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Aisha Hussain
•Good to know! I'll remember that format for my next filing. Thanks for sharing the solution.
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