UCC filing confusion with purchase money security agreement collateral description
Got myself into a mess here and need some guidance. We're a small equipment dealer and just closed on financing a $180K excavator for a contractor. The bank is requiring us to file a UCC-1 but I'm completely lost on how to describe the collateral when it's a purchase money security agreement situation. The loan docs say "purchase money security interest" but I don't know if that changes how I fill out the collateral description on the UCC-1 form. Do I need to specify it's PMSI somewhere on the filing? The excavator has a specific serial number and model but I'm worried about getting the description wrong and having the whole security interest be invalid. Bank is breathing down my neck to get this filed ASAP. Anyone dealt with purchase money security agreement UCC filings before?
38 comments
Join the conversation
Miguel Castro
The purchase money aspect doesn't change your collateral description on the UCC-1 at all. You still describe the excavator normally - make, model, serial number, year. The PMSI status is about priority rules under Article 9, not about how you describe collateral on the filing.
0 coins
Ava Martinez
•So I don't put anything special in the collateral description box about it being purchase money?
0 coins
Miguel Castro
•Nope, just describe the equipment like any other UCC-1. The purchase money priority comes from the timing and nature of the transaction, not from anything you write on the form.
0 coins
Zainab Abdulrahman
Hold up - you need to be super careful with equipment collateral descriptions. I've seen filings get rejected because the serial number format was wrong or the model description didn't match manufacturer specs exactly. What's the exact make/model of the excavator?
0 coins
Ava Martinez
•It's a 2024 Caterpillar 320 GC with serial CAT0320GCHJB123456. Should I include the engine serial too?
0 coins
Zainab Abdulrahman
•That serial format looks good. I wouldn't include engine serial unless the security agreement specifically mentions it. Keep it simple: "2024 Caterpillar 320 GC Hydraulic Excavator, Serial No. CAT0320GCHJB123456
0 coins
Connor Byrne
•Actually I'd recommend using Certana.ai's document checker before filing. You can upload your security agreement and the UCC-1 draft together and it'll flag any inconsistencies between how you're describing the collateral. Saved me from a costly mistake last month when I had the model number slightly off.
0 coins
Yara Elias
Purchase money security interests are tricky because of the priority rules but like others said it doesn't affect the UCC-1 filing itself. Just make sure you file within 20 days of the debtor receiving the equipment to maintain your PMSI priority over other creditors.
0 coins
Ava Martinez
•We delivered the excavator 3 days ago so I should be fine on timing. The bank said I have until next Friday to get it filed.
0 coins
Yara Elias
•Perfect, you're well within the 20-day window. Just get that filing done correctly and you'll have priority over any existing or future creditors on that specific piece of equipment.
0 coins
QuantumQuasar
Been doing equipment financing for 15 years and PMSI filings are pretty straightforward once you understand them. The key is accuracy in your collateral description. Don't overthink it - describe what you have security in, file it timely, and you're good.
0 coins
Keisha Jackson
•Agree completely. I see too many people get paralyzed by the PMSI rules when really it's just about filing correctly and on time.
0 coins
Ava Martinez
•That's reassuring. I was making this way more complicated in my head.
0 coins
Paolo Moretti
Wait I'm confused - what exactly IS a purchase money security agreement? Is that different from a regular security agreement?
0 coins
Miguel Castro
•A purchase money security interest (PMSI) is when the creditor helped finance the purchase of the specific collateral they're taking security in. So if you loan someone money to buy a machine and take a security interest in that same machine, it's PMSI.
0 coins
Paolo Moretti
•Oh ok so it's about using the loan to buy the thing you're securing against. That makes sense.
0 coins
QuantumQuasar
•Exactly. And PMSI gets special priority treatment under the UCC - it can jump ahead of other security interests even if they were filed first, as long as you file within 20 days.
0 coins
Amina Diop
OMG I had this exact same situation last year with a bulldozer purchase. The terminology is so confusing! I spent hours researching PMSI rules when all I needed to do was file the UCC-1 normally with good collateral description.
0 coins
Ava Martinez
•Did you run into any issues with your filing?
0 coins
Amina Diop
•Nope, went through fine. I was overthinking it just like you are. The purchase money aspect is important for priority but doesn't change how you actually fill out the forms.
0 coins
Oliver Weber
Pro tip: double-check the debtor name exactly matches what's on their business registration. I've seen PMSI filings become worthless because of debtor name mismatches, and with equipment financing the stakes are too high to mess up.
0 coins
Ava Martinez
•Good point. The contractor is an LLC - should I check with the Secretary of State to make sure I have the exact legal name?
0 coins
Oliver Weber
•Absolutely. Pull their entity record to get the precise legal name and registered address. Even small differences like missing commas or wrong entity type can cause problems.
0 coins
Natasha Romanova
•This is another area where Certana.ai really helps - you can upload the LLC documentation and your UCC-1 draft and it'll catch name discrepancies automatically. Way faster than manually cross-checking everything.
0 coins
NebulaNinja
I hate to be that guy but are you sure you're the right person to be handling this filing? Equipment PMSI can be worth hundreds of thousands and if you mess up the UCC-1 your bank could lose its security interest entirely.
0 coins
Ava Martinez
•Fair question. I usually handle simpler filings but this is a big deal for us. Maybe I should have our attorney review it before filing?
0 coins
QuantumQuasar
•Not a bad idea for a $180K deal. Better safe than sorry, especially if this is your first equipment PMSI.
0 coins
NebulaNinja
•Yeah for that dollar amount I'd definitely want legal review or at least use one of those document checking services to verify everything matches up correctly.
0 coins
Javier Gomez
The whole purchase money security agreement system seems needlessly complicated. Why can't they just make it simple like a car title?
0 coins
Miguel Castro
•Because UCC Article 9 covers way more than just vehicles - equipment, inventory, accounts receivable, etc. The complexity comes from trying to handle all different types of collateral under one system.
0 coins
Javier Gomez
•I guess that makes sense but it's still a pain for small businesses trying to figure this stuff out.
0 coins
Emma Wilson
Just curious - why is your bank making you file the UCC-1 instead of handling it themselves? Most equipment lenders I work with handle their own filings to make sure they're done right.
0 coins
Ava Martinez
•We're the dealer so I think they want us to handle the paperwork side while they focus on the loan processing. Plus we know the equipment details better.
0 coins
Emma Wilson
•Makes sense. Just make sure you coordinate with them on the filing so there's no confusion about who's doing what.
0 coins
Malik Thomas
•Actually that's pretty common in dealer financing arrangements. The dealer handles UCC filings as part of the package since they have all the equipment specs and buyer info readily available.
0 coins
Isabella Oliveira
Update us when you get it filed! Always curious to hear how these work out, especially for first-time PMSI filers.
0 coins
Ava Martinez
•Will do! Planning to file tomorrow morning after I double-check everything one more time.
0 coins
Isabella Oliveira
•Good luck! Sounds like you've got good advice here to work with.
0 coins