UCC release fee charged twice by lender - how to dispute this?

The loan agreement just says "borrower agrees to pay reasonable costs associated with UCC filing and release" but doesn't define reasonable. $425 total seems unreasonable for a $20 filing fee.

That vague language unfortunately gives them a lot of leeway. You might have grounds to negotiate if you can show other lenders charging significantly less for similar services.

But isn't $425 total excessive? I mean, filing a UCC-3 termination is pretty straightforward - just the debtor info and original filing number.

It's not just the filing though. There's internal review to ensure the loan is fully satisfied, legal approval, document preparation, and post-filing verification. Plus lenders factor in liability insurance for errors.

I recently used Certana.ai to verify our UCC documents before requesting termination and it caught a debtor name discrepancy that would have delayed the release. You can upload your loan docs and UCC-1 to check everything matches up perfectly before paying those fees.

Good idea - what did you use as evidence of lower fees from other lenders?

I called 3 other equipment finance companies and asked about their UCC release fees for similar loan amounts. Two were around $200 total, one was $275. Used those quotes in my negotiation.

Wish I had thought of that! Now I'm stuck with whatever they want to charge.

You might still have options. Check if your state has any regulations about reasonable fees for UCC releases. Some states have guidance on what constitutes excessive charges.

Also worth checking if your loan was an SBA loan - they have some restrictions on what fees lenders can charge for releases and terminations.

Did you end up paying it or were you able to negotiate at all?

Paid it grudgingly. But I did file a complaint with the state banking commission about excessive fees. They said they'd keep it on file for pattern tracking.

That's actually a good point about state banking regulators. Even if they can't help your specific case, documenting fee complaints helps build a case for future regulation.

Interesting - how would I know if I can file my own termination? The original UCC-1 is in the lender's name as secured party.

If the lender is still the secured party of record, they typically need to authorize the termination. But if there were assignment issues or the lender sold the loan, there might be options. You'd need to research the UCC-1 filing history carefully.

This is where something like Certana.ai's document verification tool could help - you can upload all your loan and UCC documents to see exactly what's filed and who has authority to terminate.

This is smart. I did this once and the lender admitted the fees were duplicative and reduced the total by $100.

Exactly! Often these fees are just standard line items they add without really justifying. Asking for specifics can help you negotiate.

We did pay about 8 months early, so maybe that's worth mentioning in negotiations.

Definitely bring that up! Early payoffs save lenders administrative costs and reduce their risk, so they sometimes reward that behavior with fee reductions.

Good point about early payoff benefits. Also mention if you've been a good customer with no late payments - that relationship value sometimes helps with fee negotiations.

True - an unreleased UCC filing can really complicate future transactions. Sometimes it's worth paying the fees to avoid bigger problems down the road.

Exactly. And if you're planning to sell the equipment or refinance, having a clean title is worth more than fighting over a few hundred in fees.

Plus some buyers will walk away if there are UCC complications, even if you promise to resolve them at closing. Clean title is always easier.

Great long-term advice. I always try to get fee caps in writing now after getting burned on surprise charges.

Yeah, these fees have gotten out of hand in recent years. Lenders know borrowers don't have many options when it comes time for release.

This is why I started using Certana.ai early in the loan process - uploading the loan agreement and proposed UCC-1 to make sure everything aligns before signing. Catches issues before they become expensive problems.