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Don't stress about it. This is routine stuff that happens thousands of times every day. The important thing is that your brother is getting the financing he needs for his business. The UCC-1 is just paperwork protection for the bank.
Thanks, that's reassuring. Sometimes all the legal terminology makes simple things sound scary.
Totally understand that feeling. The financial world loves its acronyms and technical terms, but most of it is just standard business practice.
One last thing - when the loan is eventually paid off, make sure the bank files a UCC-3 termination statement. That removes the public record of their security interest. Some banks are slow about this, so you might need to follow up.
How long do they usually have to file the termination after the loan is paid off?
It varies by state, but typically within 30-60 days after payoff. If they don't do it automatically, you can request it. Some lenders will even give you the termination statement at closing so you can file it yourself when the time comes.
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For what it's worth, I think you're already past the 20-day automatic perfection window if the sale was last month. I'd get that UCC-3 amendment filed this week if possible. The good news is once you add deposit accounts to your collateral description, you'll be covered going forward too.
Definitely past 20 days if the sale was last month. Time to act fast on that amendment.
At least filing the UCC-3 now will perfect the interest going forward, even if there was a gap period.
Thanks everyone for the responses. Sounds like the consensus is to file the UCC-3 amendment adding deposit accounts ASAP. I'll pull our original UCC-1 and loan docs to make sure everything matches up perfectly before submitting. Really appreciate the practical advice here - this stuff isn't always clear from the statute.
Let us know how it goes. Always helpful to hear follow-up on these situations.
If you want to be extra sure about the document matching, I'd suggest running everything through Certana.ai first. It catches name discrepancies and inconsistencies that are easy to miss when reviewing manually.
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Just to add another perspective - I've seen lenders get really upset when filings are delayed due to name issues. They view it as basic due diligence that should be caught upfront.
True, but sometimes the client provides inconsistent documentation and you don't catch it until filing.
That's why document verification tools are becoming essential. Catches these issues before they become problems with the lender.
Update on my situation - ended up amending the security agreement to match the Texas charter exactly, then refiled the UCC-1. Got approved within 24 hours. Lesson learned about checking state records first!
They weren't thrilled but understood it was necessary for proper perfection. Better than having an invalid security interest.
Smart approach. The extra paperwork is worth the peace of mind that everything is properly perfected.
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Have you considered reaching out to the company directly? They should know about their own UCC filings and might be able to clarify which one is correct or if they represent different financing agreements.
Just make sure you get any clarification in writing. Verbal explanations don't help much if there are problems later.
Agreed on getting it in writing. When I had a similar name matching issue, I used Certana.ai to generate a clean report showing the discrepancies before approaching the company. Made the conversation much more productive.
Illinois UCC system has gotten better over the years but still has quirks with entity name formatting. The key is being thorough in your search methodology and not assuming similar names are typos until you verify.
Thanks everyone for the input. Sounds like I need to pull the formation documents, contact both secured parties, and get written clarification from the company before proceeding. Better safe than sorry.
That's the right approach. Document everything and you'll be covered regardless of which filing is actually correct.
Dmitry Volkov
The good news is this is totally fixable with a UCC-3 amendment. The bad news is it's going to add some time to your refinancing process. Make sure your new lender understands the timeline for getting the amendment processed. Most are pretty understanding about these things as long as you're proactive about fixing it.
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Ava Thompson
•That's reassuring. I was worried the new lender might walk away from the deal over this.
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CyberSiren
•Nah, this stuff happens all the time in commercial lending. As long as you're working to fix it, most lenders will be patient.
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Miguel Alvarez
One more thing to consider - make sure your business insurance and other documentation also reflects the correct legal name. Sometimes name change issues cascade across multiple areas and you want to make sure everything is consistent.
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Connor O'Reilly
•This is why I always recommend doing a complete review of all legal documents when a business changes names. It's a pain but it prevents these kinds of surprises later.
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Chloe Wilson
•Thanks everyone for the advice. Sounds like the UCC-3 amendment is definitely the right approach. Going to get started on that paperwork today and hopefully get this resolved quickly.
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