UCC filing for solar panels - confused about equipment vs fixture classification

That's what I was afraid of. The panels are definitely bolted through the roof membrane and connected to the building's electrical panel. Sounds like fixture filing territory.

Wait, I thought solar panels were always equipment since they're not part of the original building construction? This is confusing.

Dual filing makes sense from a belt-and-suspenders approach. Better safe than sorry with a $385k loan on the line.

Agree with dual filing. Had a case where panels were deemed fixtures after the fact and the equipment-only UCC filing was worthless.

This is getting expensive though. Fixture filings cost more and need to be done in each county where the property is located.

That sounds useful. We've had UCC-1s rejected for minor name discrepancies before. How does the verification process work?

Just upload your PDFs - it compares everything automatically. For solar deals, it's especially helpful since you're often dealing with multiple entities (property owner, solar company, financing entity).

We're in Ohio. Do you know how Ohio treats solar panel classifications?

Ohio follows the majority rule - if removal would cause material harm to the building, it's a fixture. Rooftop installations that penetrate the roof structure usually qualify.

I think Ohio also has specific solar statutes that might override general fixture rules. Worth checking with local counsel.

Feel your pain. Had a similar experience with agricultural equipment that turned out to be fixtures. Lost priority to a real estate mortgage.

Exactly! And by the time you find out you filed wrong, someone else has priority. The whole system needs an overhaul.

Good point. Something like 'all solar panels and related equipment, whether classified as equipment, fixtures, or accessions'?

Exactly. Cast a wide net in your collateral description. Better to be over-inclusive than miss something.

I used similar language on a wind turbine financing. Worked well when there was later dispute about classification.

Good catch. We're actually financing the purchase from the solar company, so that shouldn't be an issue here.

Even so, double-check that the solar company doesn't have a blanket UCC on their inventory that might cover your panels.

These name matching requirements are getting ridiculous. One wrong comma and your filing gets rejected.

Tell me about it. The automated verification at least catches those issues before you file and pay the fees.

That's a great idea. Sometimes the filing office staff have insights that aren't in the written guidance.

Exactly. They see hundreds of these filings and know what works in practice vs what the statute says.

I've found the SOS staff to be pretty helpful with unusual collateral questions. Worth a phone call.

Will do. Based on all this feedback, I think we're going to go with dual filing - UCC-1 as equipment and fixture filing with the county. Better safe than sorry.

Smart approach. The extra cost is worth it for the peace of mind on a deal that size.

That's what I would do too. Solar classification is just too uncertain to risk it with a single filing strategy.

This is such an important point that often gets overlooked! I've seen deals fall apart because of something as simple as missing punctuation in the debtor name. For solar projects especially, you're often dealing with multiple related entities - the property owner, the operating company, maybe a holding company - and getting all those names exactly right is critical. That Secretary of State certificate pull is definitely worth the small fee to avoid a much more expensive re-filing later.

Absolutely agree on the entity name verification! I learned this the hard way on my first solar financing deal when our UCC-1 got rejected three times due to name discrepancies. What made it worse was that each rejection delayed our perfection by weeks while we sorted it out. For Ohio specifically, I'd also suggest checking if the borrower has any "doing business as" names that might complicate things. Sometimes solar companies operate under trade names that are different from their legal entity names, and you want to make sure you're capturing the right debtor. The state certificate is definitely worth it - saved me countless headaches on subsequent deals.

Great point about the mortgage coordination! I'm actually dealing with this exact situation right now on another solar project. The existing mortgage had language about "all improvements and fixtures now or hereafter erected" which definitely caught our solar panels. We ended up having to get an intercreditor agreement that specifically carved out the solar equipment from the mortgage lien. It added about two weeks to our closing timeline, but much better than finding out about the conflict later. For the warehouse deal mentioned here, I'd definitely recommend pulling the existing mortgage documents early in the process - you don't want any surprises at closing on a $385k deal.