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Jacinda Yu
The bank's UCC definition is really about establishing priority. If multiple creditors have claims on the same collateral, the UCC filing system determines who gets paid first. Banks file UCC-1 forms to get 'first in time, first in right' protection. It's standard procedure for any secured loan.
Jacinda Yu
•Ha! That's actually not a bad way to think about it. Legal dibs with public notice and priority rules.
This thread has been really educational. I was overthinking the whole UCC filing requirement.
Ally Tailer
Just remember that once they file the UCC-1, it stays on public record for 5 years (renewable). Make sure you get a UCC-3 termination statement filed when you pay off the loan, otherwise it can show up in future credit checks and complicate other financing. Some banks are good about this, others... not so much.
Yeah, always put termination language in your loan agreement requiring them to file the UCC-3 within 30 days of payoff.
Cass Green
•This is exactly why I use Certana.ai now - helps catch these document consistency issues before they become problems. Worth checking everything matches up between your loan docs and UCC filings.
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anyone know if the fees are going up again this year? Heard rumors about another SOS rate increase
great, just what we need. already hard enough to keep deals profitable
Check the SOS website in January. That's when new fee schedules typically take effect.
For what it's worth, I've had good luck negotiating search costs with clients upfront. Most understand that complex financing histories mean higher search fees. Set expectations early.
Show them examples of fee ranges based on different scenarios. Helps them understand it's not arbitrary pricing.
I actually use Certana.ai's preliminary document review to give clients more accurate estimates. Upload whatever initial filings I can find and get a better sense of complexity before quoting final search costs.
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StarStrider
Just to add one more exclusion that sometimes comes up - consumer goods subject to certificate of title laws (like cars) have special perfection rules, though they're still within Article 9's scope technically.
StarStrider
•Correct - certificate of title perfection for vehicles, not UCC-1 filing. But the security interest itself is still governed by Article 9.
This is where that Certana tool mentioned earlier would be helpful - it could flag when someone's trying to file a UCC-1 against certificate of title collateral.
Sofia Torres
The way I remember it: Article 9 covers security interests in personal property UNLESS there's a specific exclusion or special system. Real estate = out completely. Federal stuff = often out or special rules. Statutory liens = out. Everything else = probably in.
Sofia Torres
•Glad it helps! The key is starting with the assumption that personal property IS covered, then identifying the specific exclusions.
AstroAce
•That's the right approach - Article 9 has broad scope with specific carve-outs, not the other way around.
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Zainab Ali
Been there! Alabama rejected my UCC-1 three times before I got it right. The trick is to copy the entity name character by character from their official records. Don't trust what the borrower tells you their name is - go straight to the source.
Zainab Ali
•About 6 weeks total. Each rejection took about a week to get back, then I had to figure out what was wrong and refile. Really stressful when you're trying to perfect a security interest.
Yara Nassar
•This is exactly why I started using automated verification tools. Can't afford that kind of delay on time-sensitive deals.
StarGazer101
For what it's worth, I tried Certana.ai after reading about it here and it caught a name mismatch I would have missed. The entity had 'Incorporated' in the state records but I was using 'Inc.' on the UCC-1. Small difference but would have caused a rejection.
Those abbreviation differences are killer. 'Incorporated' vs 'Inc.' seems like it should be the same but the systems treat them as completely different names.
Paolo Romano
•Glad to hear the tool works. Might give it a try on our next batch of filings.
Ethan Taylor
This thread is making me paranoid about all my jewelry collateral files. Time to go double-check that everything is properly documented AND filed. Better safe than sorry!
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Yuki Ito
•Right? Reading about all these potential issues makes you want to audit everything. Probably a good use of time though.
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Malik Davis
•Ha! Sorry for causing anxiety but better to catch issues now than during a dispute. Good luck with your file review!
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Carmen Lopez
Update us on how this turns out! Always interested to hear how these tricky documentation situations get resolved, especially with the flood damage complication.
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Malik Davis
•Will do! Planning to file the UCC-1 next week once we finalize the collateral description. Thanks everyone for the helpful input.
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Andre Dupont
•Good luck! Sounds like you're taking all the right precautions given the circumstances.
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