UCC financing statement termination deadline missed - what are my options?

Thanks for the quick response. Do you know if there's a specific timeframe they have to respond to a written demand? We've been emailing back and forth for weeks with no progress.

Most states give them 20 days to respond to a written termination demand, but it varies. You'll want to send it certified mail with return receipt to create a paper trail. If they don't respond or refuse, you may have grounds for a wrongful failure to terminate claim.

How much did the attorney letter cost you? Trying to figure out if it's worth the expense versus continuing to push ourselves.

About $300 for the letter, but saved us thousands in delayed financing costs. Some attorneys will do it for even less if it's straightforward. The key is citing the statutory damages they could face - usually gets their attention fast.

You might also want to check if your state has a specific form for termination demands. Some states have standardized language that carries more weight than a general letter.

That's interesting - I hadn't thought about document inconsistencies being part of the problem. How detailed does their analysis get?

Pretty thorough - it flagged that our corporate name on the loan had 'LLC' but the UCC filing used 'L.L.C.' with periods. Small difference but apparently enough to cause hesitation on their end. Having the verification report made the conversation much more productive.

Good question! Even though it's lapsed and technically ineffective, the filing record still shows up in UCC searches. Many lenders and title companies want to see an actual termination statement rather than just relying on the lapse date. It's about having a clean paper trail.

Exactly this. We ran into the same issue when selling equipment - buyer's lender insisted on seeing termination statements for all liens, even lapsed ones. It's like having a clear title versus just knowing the lien expired.

Ah that makes sense. So it's more about documentation than legal necessity. Thanks for clarifying!

Because that would make too much sense! The filing system is stuck in the 1990s while everything else has gone digital.

Some states are working on automatic termination rules for certain types of filings, but it's slow going. Until then we're stuck with the manual process.

Yes, I have the filing number and all the payoff documentation. The lender is just claiming they don't have anyone available to handle UCC matters right now. It's frustrating.

That's a common stall tactic. If you have all the documentation, definitely consider the formal demand letter approach. Most banks have legal departments that take those seriously even if customer service doesn't.

How long did that process take? We're under some time pressure with our new financing.

About 3 weeks from complaint to resolution. The regulator contacted the bank and suddenly they found someone to handle UCC terminations. Worth trying if the demand letter doesn't work.

This is good advice. Regulators don't like hearing about banks not properly handling secured transaction requirements. It reflects poorly on their compliance programs.

Good point. I'll talk to our loan officer about options while we work on getting the termination filed.

Definitely communicate with them. Most experienced commercial lenders have seen this before and can structure around it if needed.

Will do. Going to try the formal demand letter first, then escalate from there if needed.

Same here - bookmarking this thread. It's amazing how common this problem seems to be.

How does their verification process work? Do you just upload the UCC filing?

You upload both the original loan documents and the UCC filing as PDFs. It automatically compares debtor names, collateral descriptions, filing numbers - basically everything that needs to match. Really saves time versus doing manual comparisons.