Have you recently taken on the job of a manager in a company? Do you wonder what you need to keep an eye on to safeguard your business against certain risks? As a business owner, this is something you need to check on regularly to avoid issues down the road.
If you have limited knowledge when it comes to business law, you may have no idea how to move forward. Thankfully, there are online resources that can help.
A UCC filing is something you can use to help protect your company's assets. Keep reading to learn more about what a UCC filing does and how you can use it to the advantage of your company.
The Basics
UCC filing is a system used to keep track of lenders and debtors in transactions involving personal property. The government is the one that maintains the so-called "Uniform Commercial Code."
By using this filing, lenders can assure that they're protected in case of defaulted payments or insolvency by a debtor. It makes it easier to repossess collateral should a debtor not be able to uphold the terms of the contract.
The filing also gives the debtor more transparency and an understanding of what a lender is allowed to do in collecting a debt. The UCC filing system is mandated by the state, and all creditors should abide by it.
How Does It Work
The UCC filing process is often used by lenders when lending money to businesses and consumers. The lender will file the financing statement (UCC-1) with the Secretary of State’s office, detailing the lender’s rights in the debt agreement. This filing is in effect until the debt is fully paid.
The filing is viewable by anyone online, as well as any other creditor, to establish a priority of security interests. UCC monitoring grants the lender the upper hand in any dispute about the debt.
To have the UCC-1 amended or terminated, the filing party must provide extra filings to the Secretary of State’s office. This filing process is an important part of the debt agreement and helps to protect a lender’s interests.
The Necessary Steps to Follow
When considering filing a UCC, there are a few necessary steps to follow.
First, you need to determine which state forms you will need. The page on online UCC system or speaking with an attorney is a great start in understanding any relevant filing requirements. You can also seek help on state laws to make sure all paperwork is properly submitted.
Next, you must get the proper legal forms from either the Secretary of State's website or the local filing service. Complete the form, making sure to include all required information.
You also need to pay the associated filing fee. Once the payment's received, the filing can be accepted, and documents will be due within the specified period. Finally, after the paperwork has been approved, you will need to keep a copy of the document to prove that the UCC filing was processed.
UCC Filing: An Opportunity for Growth
UCC filing can be complex. But, understanding the process can save businesses from expensive and troublesome problems in the future. With the above guide, business owners now have the information they need to approach UCC filing with confidence.
Get started today and start protecting your business and its assets!
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