UCC filing expiration - missed my continuation deadline by 3 weeks

This is exactly why I set quarterly calendar reminders starting 18 months before expiration. The continuation window opens 6 months before the 5-year anniversary, so there's plenty of time if you stay organized. But yeah, once it lapses there's no fixing the priority issue.

Wait, I thought you could file a late continuation? Or is that only for certain states? I'm confused about the rules here.

No late continuations in the UCC system. Article 9 is pretty clear - the financing statement lapses at the end of the 5-year period unless a continuation statement is filed within the 6-month window before expiration. Some people confuse this with tax lien procedures which sometimes have grace periods, but secured transactions don't work that way.

I haven't done a new search yet - honestly I just discovered this mess yesterday. The equipment is pretty specialized manufacturing stuff so hopefully no one else would have filed against it, but I need to check. Do you remember how long the documentation updates took for your client?

It added about 2 weeks to their closing timeline because the lender's legal team had to revise the security agreement to reference the new UCC filing number and date. Plus they wanted a fresh appraisal on the collateral since there was technically a gap in perfection. Not fun, but manageable if you stay on top of it.

Two weeks sounds optimistic. When we had a lapsed filing situation, the underwriting department made us jump through hoops for months. They treated it like a completely new loan application in some ways.

Never heard of that service but sounds useful. Do they handle the actual filing or just the document review?

Just the document verification part - you upload PDFs and it cross-checks everything for consistency and flags potential issues. The actual filing still has to go through your state's SOS portal, but at least you know your docs are clean before submitting.

Honestly at this point I'd try anything to avoid this kind of mistake again. Missing a continuation deadline is probably one of the worst screwups you can make with secured lending.

Good point about the collateral description. We've added some new equipment and disposed of older machines since the original filing. I assume the new UCC-1 should reflect the current asset base rather than what was there in 2020?

Exactly. The collateral description should match what you're actually pledging as security for the loan. If you're refinancing, your lender will probably want a current equipment schedule anyway for valuation purposes.

This is making me paranoid about my own filings now. Is there an easy way to check expiration dates for multiple UCCs without going through each state portal individually?

How much did it impact your borrowing costs? We're worried the refinancing rate is going to take a hit because of this mess.

Hard to quantify exactly, but we definitely didn't get their best rate tier. The lender cited 'administrative risk factors' and bumped us up maybe 50-75 basis points from what we would have qualified for otherwise. Could have been worse though.

50-75 bp sounds painful but not catastrophic. At least they didn't walk away from the deal entirely.

I haven't told the refinancing lender yet - we're still in preliminary discussions. I was hoping to get the new UCC-1 filed and then disclose it as an 'administrative update' rather than admitting the screwup. Bad idea?

Terrible idea. If they discover the gap during their due diligence (which they will), it looks like you were trying to hide something. Better to be upfront about the mistake and show them your plan to prevent it from happening again. Lenders hate surprises more than they hate honest mistakes.

Agreed, transparency is always better. Plus if you're proactive about fixing it, they might be more willing to work with you on timeline and terms.

How long did the whole process take from discovery to resolution?

About 6 weeks total, but that included time for the lender's legal review and some back-and-forth on collateral descriptions. The actual UCC-1 filing only took a few days once we had clean documents.

6 weeks isn't too bad if you're not under immediate pressure. The key is getting ahead of it before other creditors notice the gap.

We use a specialized legal software that has UCC tracking modules, but it's pretty expensive. For smaller portfolios, even a good calendar system with multiple alerts can work if you're disciplined about it.

I've heard some people mention that Certana service for document checking - does that do expiration tracking too or just verification?

It flags expiration dates when you upload documents, but I don't think it's a full portfolio management system. Still helpful for catching issues before they become problems though.

What kind of costs are we talking about for the refiling process? Just trying to budget for the mess.

Filing fees are usually under $100, but legal fees for document updates can run $2000-5000 depending on complexity. Plus potential appraisal costs, lien search fees, and the time value of delayed refinancing. It adds up quickly.

Ouch. That's more than I was hoping but less than I was fearing. Thanks for the realistic estimate.

We're still in the same state and same legal entity, so that shouldn't be an issue. But good reminder to double-check the debtor information for any changes.

Even small changes like adding 'LLC' to your business name or changing registered addresses can cause UCC search issues later. Worth being extra careful about exact name matching.