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UCC-1 Statement


A UCC-1 statement, also known as a UCC-1 financing statement, is a legal document used in the United States to establish a secured party’s interest in a debtor’s personal property that serves as collateral for a loan. The statement is filed with a government agency, typically the secretary of state or equivalent office in the debtor’s jurisdiction. This filing serves as public notice that a creditor has a security interest in the specified assets, giving them priority over subsequent creditors in case of debtor default or bankruptcy.


The phonetic pronunciation of the keyword “UCC-1 Statement” is:Yoo – See – See – Wən – Stāt-mənt

Key Takeaways

  1. Financial claim notice: UCC-1 (Uniform Commercial Code-1) Statement is a legal form that creditors file with the appropriate government agency, giving public notice of a secured claim against specified assets of a debtor. It is an essential part of the overall financing process and serves as a protection for lenders and creditors.
  2. Perfection of interest: The primary purpose of filing a UCC-1 statement is to ensure the “perfection” of a lender’s security interest. When a lender perfects their interest, they establish priority over other creditors or subsequent creditors, protecting themselves from having their collateral claimed by someone else in case of debt default by the borrower.
  3. Information provided: A UCC-1 statement typically includes information such as the names and addresses of both the secured party (creditor) and the debtor, a description of the collateral, and any additional details relevant to the transaction or the relationship between the parties involved. This information helps identify the parties and assets to be secured, ensuring transparency in the credit market.


The UCC-1 Statement, or Uniform Commercial Code-1 Financing Statement, is a crucial document in business and finance as it serves to protect a creditor’s security interests in collateral pledged by a debtor. This document is filed with the appropriate government agency, typically the Secretary of State’s office, and establishes the creditor’s priority in the event of a debtor’s default, bankruptcy, or other competing claims from other lenders. By publicly notifying potential lenders, credit providers, and other parties of the existing security interest, the UCC-1 Statement prevents multiple financing obligations on the same collateral, thus promoting transparency and safeguarding creditors’ rights in secured transactions.


A UCC-1 Statement, also known as a UCC-1 Financing Statement, is a legal document used to establish a secured interest in a debtor’s personal property. The primary purpose of a UCC-1 statement is to give public notice of a secured party’s claim on the debtor’s property and thereby protect the creditor’s rights. By filing this statement, the creditor ensures their claim receives priority over any future parties who may also have an interest in the same collateral. This is particularly important in cases where the debtor defaults, as the secured creditor will be given priority in recovering their outstanding debts or obligations. The UCC-1 statement contains essential information including the debtor’s name, the secured party (creditor), and a description of the collateral involved. This document is typically filed with the Secretary of State, or a similar public office, where the debtor is located or incorporated. Once filed, the UCC-1 statement becomes a public record, informing other potential creditors or interested parties about the existing lien on the collateral. This information can be instrumental in allowing subsequent creditors to make informed decisions and assess their risks when considering granting credit or a loan to a debtor, ensuring the overall stability and transparency in the financial landscape.


A UCC-1 Statement, also known as UCC-1 Financing Statement, is a legal document filed by a creditor to assert an interest in the personal property of a debtor as collateral for a loan. Here are three real-world examples of when a UCC-1 Statement is used: 1. Small Business Loan: Imagine a small business owner wants to take out a loan to expand their business. The lender agrees to provide the loan but requires collateral, in case the owner cannot pay back the borrowed funds. The lender files a UCC-1 Statement with the appropriate government agency, asserting their interest in specific assets of the business (e.g., equipment, inventory) as collateral. 2. Equipment Leasing: A construction company needs to lease heavy equipment for a long-term project. The leasing company provides the equipment, but they want to ensure their legal rights to the equipment in case the construction company defaults on their lease payments or goes bankrupt. The leasing company files a UCC-1 Statement to record their security interest in the leased equipment. 3. Inventory Financing: A retail store has seasonal fluctuations in their inventory and requires financing to purchase additional inventory during their busy season. The retailer approaches a finance company for a short-term loan. The finance company agrees to provide the funding, but they want to ensure their interest in the inventory being purchased. The finance company files a UCC-1 Statement to secure their interest in the new inventory as collateral for the loan.

Frequently Asked Questions(FAQ)

What is a UCC-1 Statement?
UCC-1 Statement, also known as UCC-1 Financing Statement, is a legal document filed by a creditor to give notice that it has an interest in the personal property of a debtor, as collateral for a debt. It is governed by the Uniform Commercial Code (UCC), a set of standardized business laws adopted in the United States.
What does UCC-1 stand for?
UCC-1 stands for “Uniform Commercial Code-1” and refers to Article 1 of the Uniform Commercial Code.
What is the purpose of a UCC-1 Statement?
The primary purpose of a UCC-1 Statement is to establish and publicize the creditor’s security interest in the debtor’s collateral. This protects the creditor’s priority in the event of debtor’s default, bankruptcy or other creditor claims against the debtor’s assets.
Who can file a U-CC1 Statement?
Creditors, such as banks, credit unions, and other financial institutions which have extended credit or loans against the debtor’s personal property can file a UCC-1 Statement.
Where do you file a UCC-1 Statement?
A UCC-1 Statement is generally filed with the Secretary of State’s office in the state where the debtor is located or has a registered office. Some states may require filing with the county clerk or other local government office.
What information is required on a UCC-1 Statement?
A UCC-1 Statement typically includes the following information: 1. Debtor’s legal name and address 2. Creditor’s legal name and address 3. Description of collateral (assets subject to the security interest) 4. Whether the financing statement covers consumer goods, inventory, equipment, or farm products
How long is a UCC-1 Statement valid?
A UCC-1 Statement is generally effective for 5 years from the date of filing. It can be extended by filing a continuation statement before the expiration of the initial 5-year period.
Can a UCC-1 Statement be terminated or canceled?
Yes, a UCC-1 Statement can be terminated or canceled by the creditor by filing a UCC-3 Termination Statement, which releases the creditor’s claim to the debtor’s collateral. This usually occurs when the debtor has fully repaid the secured debt.
Can a debtor dispute the accuracy or validity of a UCC-1 Statement?
Yes, if a debtor believes that the information in a UCC-1 Statement is incorrect or that the filing was unauthorized, they can file a UCC-5 Information Statement, also referred to as a Correction Statement. However, this does not remove the UCC-1 filing from the public record; it simply provides a notice of the debtor’s claim and may prompt further investigation or legal action.

Related Finance Terms

  • Secured transactions
  • Collateral
  • Uniform Commercial Code
  • Financing statement
  • Debtor and creditor

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