UCC judgment lien complicating my continuation filing - need advice ASAP
So I'm dealing with a mess here and my continuation deadline is coming up fast. I've got a UCC-1 that expires next month and when I went to file the UCC-3 continuation, I discovered there's a judgment lien that got recorded against my debtor last year. The judgment creditor apparently tried to claim priority over some of the same equipment that's described in my original collateral schedule. My lender is freaking out because they're saying this could affect the perfection of our security interest when we continue. Has anyone dealt with a UCC judgment lien situation like this before? Do I need to amend the collateral description on my continuation or can I just file the standard UCC-3? The debtor's business name is exactly the same on both filings but I'm worried about priority issues. This equipment financing deal is worth $180K and I can't afford to mess up the lien position.
37 comments
Join the conversation
Caden Nguyen
Judgment liens can definitely complicate your UCC filings but they operate under different rules than Article 9 security interests. Your UCC-1 perfection date is what matters for priority against the judgment lien, not your continuation filing date. As long as your original UCC-1 was filed before the judgment lien was recorded, you should maintain priority. Just file your UCC-3 continuation with the same collateral description - don't amend unless there's been an actual change in the collateral.
0 coins
Avery Flores
•This is exactly right. The judgment lien doesn't change your existing priority position. Your continuation just extends your original filing date for priority purposes.
0 coins
Zoe Gonzalez
•But what if the judgment creditor levied on the equipment? That could mess up the debtor's ability to maintain possession which might affect the security agreement terms.
0 coins
Caden Nguyen
•Good point about levy issues. That's more of a contract matter between the secured party and debtor though. The UCC filing priority is still based on first-to-file rules.
0 coins
Ashley Adams
Wait, are you sure about the dates? I had a similar situation where the judgment lien actually got priority because there was some gap in my UCC coverage. Double check that your original UCC-1 effective date is definitely before the judgment lien recording date. Also make sure the debtor name on the judgment matches exactly with your UCC-1 debtor name - sometimes there are slight variations that can cause problems.
0 coins
Harper Hill
•Just double checked and my UCC-1 was filed 18 months before the judgment lien was recorded. Debtor names match exactly. So I should be good on priority?
0 coins
Ashley Adams
•Yeah you should be fine then. The 18 month head start gives you clear priority. Just get that continuation filed before your expiration date.
0 coins
Alexis Robinson
I ran into document consistency issues when I had overlapping liens like this. Ended up using Certana.ai's UCC document verification tool to upload my UCC-1 and the judgment lien documents together. It instantly flagged that the collateral descriptions had some overlap but confirmed my filing dates gave me priority. Really helpful to have that automated cross-check rather than trying to compare everything manually - especially when you're under time pressure with a continuation deadline.
0 coins
Aaron Lee
•How does that tool work exactly? Do you just upload PDFs of all the documents?
0 coins
Alexis Robinson
•Yeah exactly. Upload your UCC-1, the judgment lien, and any other relevant docs. It cross-checks debtor names, collateral descriptions, filing dates, and flags any potential conflicts or inconsistencies. Super quick and catches stuff you might miss when you're stressed about deadlines.
0 coins
Harper Hill
•That actually sounds really useful for my situation. I've been manually comparing everything and it's making me nervous that I'm missing something important.
0 coins
Chloe Mitchell
Judgment liens are the worst!! I swear they always pop up at the most inconvenient times. Had one show up right before a loan closing last year and it nearly killed the whole deal. The title company went crazy trying to figure out priority issues.
0 coins
Michael Adams
•Tell me about it. And half the time the judgment debtor doesn't even know it exists until it screws up their financing.
0 coins
Chloe Mitchell
•Exactly! This debtor probably has no idea their business credit is getting trashed by this judgment lien.
0 coins
Natalie Wang
One thing to watch out for - some states have weird rules about judgment liens against business equipment vs personal property. Make sure you're looking at the right statutes for your jurisdiction. Also, if this is a federal tax lien instead of a regular judgment lien, the priority rules are completely different.
0 coins
Harper Hill
•It's definitely a regular state court judgment lien, not federal tax. But good point about checking state-specific rules.
0 coins
Natalie Wang
•Good. Regular judgment liens are much more straightforward. Federal tax liens have their own crazy priority scheme that doesn't follow normal UCC rules.
0 coins
Noah Torres
ok this might be dumb but what exactly is a judgment lien and how is it different from a UCC lien? I thought all liens were basically the same thing
0 coins
Caden Nguyen
•A judgment lien comes from a court judgment - like when someone sues a business and wins money damages. The judgment creditor can then record a lien against the debtor's property to secure payment. UCC liens are consensual security interests created by agreement between the debtor and secured party.
0 coins
Noah Torres
•oh ok so the judgment lien is involuntary and the UCC lien is voluntary basically?
0 coins
Caden Nguyen
•Exactly. And they have different priority rules and different enforcement procedures.
0 coins
Samantha Hall
I'm curious about the collateral description overlap you mentioned. If the judgment lien covers 'all equipment' and your UCC-1 has a specific equipment schedule, does that create any problems? Or is it just about who filed first?
0 coins
Harper Hill
•The judgment lien is pretty broad - it just says 'all personal property of debtor' basically. My UCC-1 has specific serial numbers for the equipment I financed.
0 coins
Samantha Hall
•That broad judgment lien language could technically cover your equipment, but since you filed first, you should have priority. Just make sure your collateral description is still accurate for the continuation.
0 coins
Ryan Young
Have you considered whether this judgment lien affects your debtor's creditworthiness going forward? Even if you maintain priority on this filing, it might impact future financing decisions with this borrower.
0 coins
Harper Hill
•Yeah that's definitely a concern. This was supposed to be the first of several equipment financings with this customer but now I'm wondering if we should reassess their credit profile.
0 coins
Ryan Young
•Probably worth having a conversation with the debtor about the judgment and whether they have a plan to resolve it. Could affect their ability to maintain the equipment or meet their payment obligations to you.
0 coins
Sophia Clark
I just went through something similar and used that Certana tool someone mentioned earlier. Really glad I did because it caught that the judgment creditor had actually filed an amendment to their lien that expanded the collateral description. Would have missed that if I was just doing manual document review. The cross-referencing feature saved me from a potential priority dispute down the road.
0 coins
Katherine Harris
•Wait, judgment creditors can amend their liens? I didn't know that was possible.
0 coins
Sophia Clark
•Depends on the state but yeah, sometimes they can file additional or amended abstracts of judgment to cover more property or correct errors. That's why automated document checking is so valuable - it catches all the related filings you might miss.
0 coins
Madison Allen
Bottom line - get your UCC-3 continuation filed ASAP and don't overthink the judgment lien issue. As long as your dates are solid and your debtor name matching is exact, you're protected. The judgment creditor can fight for whatever's left after your security interest is satisfied, but they can't jump ahead of your priority position.
0 coins
Harper Hill
•Thanks, that's reassuring. I was starting to panic that this judgment lien was going to mess up my whole filing strategy.
0 coins
Madison Allen
•Nah, you're good. Just stick to the basics - file your continuation on time with accurate information and your priority stays intact.
0 coins
Joshua Wood
One more thing to consider - if this debtor ends up in bankruptcy, both your UCC lien and the judgment lien could face challenges from the trustee. But that's a bridge to cross if you come to it. For now, just focus on maintaining your perfected security interest through the continuation filing.
0 coins
Justin Evans
•Ugh, bankruptcy is a whole other nightmare. Preference actions, avoidable liens, all that fun stuff.
0 coins
Joshua Wood
•True, but at least having a properly perfected and continued UCC filing puts you in the best possible position if bankruptcy does happen.
0 coins
Eleanor Foster
Just want to emphasize what others have said about timing - don't delay that UCC-3 filing! I've seen too many secured parties lose their perfection because they got distracted by side issues like judgment liens and missed their continuation deadline. Your 18-month priority window over the judgment lien is solid, but it won't matter if your UCC-1 lapses. File the continuation first, then deal with any other complications afterward. The judgment lien is really a separate issue from maintaining your Article 9 security interest.
0 coins