UCC and Related Services

The term UCC is an acronym for Uniform Commercial Code. The Uniform Commercial Code is a comprehensive set of laws governing commercial transactions. These transactions include borrowing money, leases, contracts and the sale of goods. The UCC is not a federal law, but a product of the National Conference of Commissioners on Uniform State Laws and the American Law institute, private organizations that recommend the adoption of the UCC by state governments. State legislatures may either adopt the UCC verbatim or may modify to meet the state’s needs. Once a State’s Legislature adopts and enacts the UCC it becomes a state law and is codified in the state’s statutes. All 50 states and U.S. territories have enacted some version of the UCC.

The document to use is a UCC-1 form, also known as a Financing Statement. When a lender (Secured Party) secures interest in a borrower’s (Debtor’s) personal property used as collateral, the lender files form UCC-1 with the Secretary of State Office or equivalent local records office.

If the debtor is:

• a registered entity; file in the State of Formation
• a non-registered entity; file in the state of the chief executive office
• an individual; file in state of residence
• a foreign debtor from a jurisdiction without a personal property indexing system; file in Washington, DC.

The County Recorder will file a UCC Financing Statement when a piece of personal property which has been attached to real property in such a way as to become part of real property. When filing a UCC with the County Recorder, the UCC1AD addendum must be used. Box 12 must be checked and a description of real property must be included in box 14.

To have a perfected Financing Statement you must input the true, legal name of the Debtor. For a registered entity, you should obtain a copy of the formation document that was filed in the state of incorporation. A good standing certificate is not sufficient to perfect. For Individuals, you should obtain a copy of the drivers’ license, birth certificate, social security or passport. If you need UCS to assist in determining the true, legal name or obtain a copy of formation documents click here.

To include additional Debtors/Secured Parties, attach either an Addendum form UCC1AD) or Additional Party form (UCC1AP).

You can place the collateral description or continuation of a collateral description on either an addendum form (UCC1AD) or attach additional page(s) to the financing statement or amendment.

If the filer desires to use the titles of lessee and lessor, or consignee and consignor, or seller and buyer, or bailee and bailor instead of Debtor and Secured Party, check the appropriate box in item 5. If this is an agricultural lien as defined in Commercial code filing or is otherwise not a UCC security interest filing (e.g., a tax lien, judgment liens, etc.) check the appropriate box in item 5, complete items 1-7 as applicable and attach any other items required under other law.

If Debtor is a trust or a trustee acting with respect to property held in trust, enter the Debtor’s name in item 1 and attach the Addendum form UCC1AD) and check the appropriate box in item 17. If the Debtor is a decedent’s estate, enter the name of deceased individual in item 1b and attach the Addendum form (UCC1AD) and check the appropriate box in item 17. If Debtor is a transmitting utility or this Financing Statement is filed in connection with a Manufactured-Home Transaction or Public-finance Transaction as defined in applicable Commercial Code, attach Addendum form (UCC1AD) and check appropriate the box in item 18.

There are three types of addendum forms. The first two are UCC1AP and UCC3AP for use when you need to insert additional debtor or secured parties on the UCC1 or UCC3 forms. The third is UCC1AD which is used for real estate related collateral where box 12 must be checked and a legal description must be included in box 14. If the record owner of the real estate is not the Debtor, the name and address of the record owner must be provided in box 15. When the Debtor is a transmitting utility, or a transaction is connected with public finance or a manufactured home, box 18 of the addendum must also be checked.

UCC Financing Statements as well as fixture filings have a five year effective period with the following exceptions:

• Record of Mortgage – When a record of mortgage includes fixtures and is filed in the local land recording office, it is effective as a financing statement in regards to the fixtures and a UCC1 financing statement form does not need to be filed. In this case, the effective period is the same as the record of mortgage, which is until the mortgage is satisfied or otherwise released or terminated.
• Manufactured Home Transactions – A manufactured home is a house or other structure which is fabricated off sited in whole or in parts and then transported and affixed to its permanent location. When a UCC financing statement is filed in connection with a manufactured home transaction the effective period is 30 years. Box 18 of the UCC1Ad for must be checked or the effective period will default to five years.

**The following states have only a five year effective period for manufactured home transactions: Georgia, Louisiana, North Dakota, Oregon and Washington. In West Virginia the effective period for manufactured home transactions is 40 years.

• Transmitting Utilities – Filings for transmitting utilities are effective until terminated. Box 18 of the UCC1Ad form must be checked or the effective period defaults to five years.**Filings for transmitting utilities in Georgia are only effective for five years.
• Public Finance Transactions – The effective period for filings connected with public finance transactions is 30 years.* In West Virginia the effective period for public finance transactions is 40 years.The Following states have only a five year effective period for public finance transactions: Alabama, Alaska, Arizona, Colorado, Florida, Georgia, Kansas, Michigan, Missouri, North Dakota, South Dakota and Washington.

Complete a UCC Financing Statement Amendment to continue within six months of the expiration date of the original filing the effectiveness of the financing statement with respect to security interest of authorizing Secured Party. Type the original filing number and date filed in box 1a and check box 3. Enter name of party authorizing amendment in box 9.

To amend a filed UCC Financing Statement you need to complete a UCC Financing Statements (UCC3). Below are the types of amendments you affect on a UCC3:

• Change name of debtor or secured party
• Change address of debtor or secured party
• Delete debtor or secured party
• Add debtor or secured party
• Collateral change
• Continue or Terminate the UCC Financing Statement

Be aware that some states require that a separate UCC3 be filed for each amendment. Contact us to help determine the requirements of the state you are filing in.

You can prepare and file Statement of Claim form (UCC5). Check box 2a if record is inaccurate and provide basis of inaccuracies. Check 2b, if the record was wrongfully filed, and provide the basis why it may have been wrongfully filed. The filing of this statement of claim does not affect the effectiveness of an initial financing statement or other filed record.

North Dakota and South Dakota require a tax id number for the debtor.

• North Dakota
  Requires all UCC filings be done online.
• South Dakota
  The Secretary of State’s office will ONLY accept the NEW South Dakota forms or the National UCC-1 forms. EFS Filings must be submitted on the NEW South Dakota EFS forms. Any filings submitted on old forms will be returned. If using the national form, the tax id # can be included in box 4 (collateral description).

We can conduct a search to reflect which will provide a list of all active UCC Financing Statements against the debtor. Doing a search to reflect will also alert you to any entry errors made by the filing office. It is imperative that you also review the search results to ensure that the filing office had not re-entered your submission and made entry errors in your collateral, debtor or secured party information.