How To File A UCC-1 Yourself

Last updated on July 14, 2023

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The Uniform Commercial Code, or the UCC, is a series of uniform acts established to harmonize sales and other transactions. A UCC-1 is an official legal notice lenders may file to declare their ability to lay claim to collateral if the borrower defaults on the loan. However, this process is easier said than done.

You can file a UCC-1 yourself by completing two steps. It’s necessary to complete the form and then, once done, record the paperwork in the proper spot. There are several smaller steps in between, which aren’t too complicated for a lender to complete.

If you’re curious about how to file a UCC-1 yourself, you’ve come to the right place. Read on to learn more about this process, what happens if you don’t file, and other vital information. As a borrower, it’s a good idea to understand this process for your security in any business transaction.

How To File A UCC-1 Yourself

If it’s your first time as a lender or filing a UCC-1, it's overwhelming to consider this paperwork. What steps do you need to take? What forms should you fill out? Luckily, it isn’t too complicated to complete a UCC-1.

Let’s go over each step in filing a UCC-1 for yourself. It isn’t a tricky process, but cover every stepstone to ensure the process takes the least possible time, and you can declare your claim before other third-party lenders have priority.

Complete the Form

Before submitting the form to the proper source, it’s necessary to complete the paper. You must locate it online and fill it with the correct information.

Let’s talk more about the tiny steps to finish the form. From downloading the paper to filling out descriptions and addendums, there are many items you should do to ensure everything is filled out correctly.

Download the Form

Your first step is to access and download the required form for the UCC-1. It’s simple to access this form online, typically on the Secretary of State’s office website. You can find it by entering “secretary of state” and your state name into the search engine. You should go to their site and download the proper UCC-1 form for your state.

Most forms are universal, but some states could have different requirements. It’s a good idea to read up on the details for your location to ensure you know what your form entails. Ensure you take a look at filing fees before downloading the paper.

Provide Contact Information

Next, you might provide contact information on the paperwork. At the beginning of the work, there is a section where you may write down contact details.

You may add the following information to the UCC-1 paper:

• Telephone number
• Mailing address
• Email address

These will make it simpler to be contacted if necessary.

It’s critical to be careful when adding this contact information to a UCC-1. Once filed, this product will be a public record. If you have any information you don’t want in the public system, ensure you don’t place it on the file.

Add the Debtor’s Information

Next, it’s time to add the debtor’s information to the paperwork. This individual is the person who took out the loan from you. This specification might be a person, or it could be a business or organization that has borrowed funds.

If the loan happens to be under the name of an organization, include the mailing address. This information is critical for further contact as the process goes on.

Usually, there is room for additional debtors on the paper. Ensure you check the loan agreement and write them down exactly as they are to make it legal. If there is not enough room on the page for every debtor involved, use an addendum to place them on the UCC-1.

List Secured Party Information

Once you have the information, you must note the secured party information. This section is you, the individual or organization (typically a bank or lending company) that made a deal with the debtor to lend cash or assets for a secured loan.

Add the name and address of the secured party. If it is a larger company, find the preferred address before writing it down. If you are the debtor filling out the paperwork, don’t just write down the address of the local branch you use - contact them for the best location to jot down on the UCC-1.

Write Collateral

The collateral is the next item that should go down on the UCC-1. This section lists all collateral used in the deal, indicating what the lender has a right to do if the debtor defaults on the loan. There should be room to fill out this information below the official name and address of the secured party involved.

Ensure you are as specific as possible when writing down the collateral to clarify what items are up if the debtor defaults. For instance, if a large real estate property is involved, jot down the legal description denoted on the deed.

There might not be room for every bit of collateral securing the deal. If this issue arises while filling out the forms, use an addendum to write everything else.

Add Descriptions and Addendum

Finally, when filling out the UCC-1 form, you should end the process by filling out descriptions and an addendum. These items serve as the icing on the cake for the UCC-1.

Add any applicable descriptions of the transaction at the bottom of the UCC-1. There are several boxes which you should read. If any of these boxes apply to your situation, check them. If they don’t, do not.

If there is any additional information you did not have room for in other portions of the UCC-1, use an addendum to add everything left at the bottom. There is typically another addendum form where you will find the UCC-1 online. If you live in a state that requires additional information, you will also use an addendum for this process.

Once these are done, you should have a completed UCC-1 form. Next, it’s time to record the form for legal registration.

Record the Form

Once you have everything filed and written down, double-check it to ensure everything is there. When you are sure, it’s time to record the form.

Let’s dive into the details you need to know to file the UCC-1. Once it’s turned in, your paperwork is official, and the UCC-1 is in place.

Locate Proper Filing Spot

First, locate the correct spot where the UCC-1 can be filed. They are not based on the lender's home but on the location where the debtor lives. They might also be in the central office if the debtor is a large business. Most of the time, the UCC office for the state is the proper location for this filing.

There are some additions to consider when filing. If there is real estate attached to your UCC-1, you may need to file a copy, along with the register of deeds, in the spot where that particular real estate exists.

Add Information Form For Copies

If you want to make a copy of the UCC-1 form before you submit it, you should fill out an informational document. Most of the time you’ll get an acknowledgment copy once the form is submitted, but it never hurts to have more papers in case legal issues arise.

There are several reasons you might want to order more copies for the process. For instance, if multiple debtors are involved in the contract, you might need a form for each of the borrowers. If you can’t download information from the legal website where the paperwork will be visible, you may want to purchase another copy for your files.

Enter Forms and Fees

If it’s possible, submit forms and fees ahead of time. It’s almost always easier to file online, and the statement goes for your UCC-1 form. Plus - the payments are frequently lower. Check on the secretary of state's website in your area to see if it’s possible to file it online.

This might not be possible if there is significant real estate offered as collateral in the loan. You will likely need to file a paper copy and register of deeds right in the county where the real estate sits.

Mail a Financing Statement With a Filing Fee

If you don’t want to file online or it isn’t possible to complete the process through the Internet, you must mail your financing statement with a filing fee. You must send the paper copies right to the office of the state for UCC.

Before you mail, check for the filing fee amount and what forms of payment they accept. Some may only want a check, while others might be fine if you send in a money order.

Most fees are less than $20. However, some states may charge based on the number of pages submitted in the mail.

Wait For Acknowledgement Letter

Once the paperwork is submitted online or through the mail, all you can do is sit back and wait for word that your paperwork reached its destination. Once the UCC office of the state records the information, you will receive an acknowledged copy of the statement and a letter to prove you are finished with the UCC-1 filing process.

Do not get rid of these documents. Instead, file them away in a safe place for potential use in the future. It’s a quality idea to put these papers with any other paperwork involved with the loan.

What Happens If You Don’t File A UCC-1?

If you do not file a UCC-1, you won’t get in trouble. However, if the loan defaults, you are considered an unsecured lender. You will be pushed to the back of the line, all the way behind the lenders that are secured if there are multiple lenders associated with the debtor.

Those who do not file a UCC-1 could lose a significant amount of money if things fall through with the debtor. It’s best to file one to protect your interests, even if you think the individual or organization you lent the money to will pay you back in good time.

When Must UCC-1 Financial Statements Be Filed?

Although there are no official statutes for when a UCC-1 financial statement must be filed, they usually appear at the start of the loan. Most lenders decide to file them right away to ensure they are secured. You never know what will happen in the ever-changing financial climate of our world.

A typical UCC-1 financial statement will be legal for five years. After that point, the lender must refile or remove the UCC-1. Lenders may use a continuation statement to extend the UCC-1 statement past its original filing date if applicable.

What Is A Continuation Statement?

A continuation statement is an amendment to a UCC-1 that will extend the lien, or UCC-1, of the lender. It pushes it past the original financing date, which may extend it up to five years past the original financing date.

Lenders may file a continuation statement to ensure they are in the best position to secure repayment for their debt if they are worried about getting their finances back. They are effective ways to defend lenders throughout the entire buying process.

Can UCC-1 Be Removed?

A UCC-1 can go away in a few ways. There are two ways to take away this lien.

The most common include:

• Asking the lender to remove the lien once the payment is covered
• Swearing under oath at a local office that the loan is complete if the lender does not take away the paperwork

Each may only occur when the debt receives payment in full.

In time, a UCC-1 will go away if all ends go as promised. A UCC-1 is an excellent idea for the defense and security of the lender.

Reference Legal Explanations

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