Many lenders will require a UCC-1 Financing Statement to utilize personal property as additional security for their loan. A UCC-1 Financing Statement may be recorded in the County in which the real property is located. The UCC-1 is typically recorded concurrently with and after the deed of trust or mortgage instrument or as instructed by the lender.
A UCC-1 Financing Statement should be filed with the Secretary of State in the jurisdiction of the location of the debtor. Enforcement of a debt secured with a UCC Financing Statement comes under the Uniform Commercial Code. It is actually the state filing that perfects the lien. In the case of an individual, it should be filed in the state in which they reside. In the case of a legal entity, it should be filed in the state in which the entity was organized. For example, if the debtor has its primary residence in Arizona, the UCC-1 would be filed with the Arizona Secretary of State. If the Debtor is a California Limited Liability Company, the UCC-1 would be filed with the California Secretary of State.
The Secured Party and the Debtor should determine the location of the recording and/or filing of the UCC statement. The completed UCC-1 Financing Statement is normally provided by the lender.
UCC-1 Financing Statements do not have to be signed by either the Debtor or Secured Party; however, they must be authorized. This means that the parties must instruct the settlement agent, in writing, to record the UCC with County Recorder and/or to file it with the Secretary of State, naming the county recorder and the state jurisdiction.
Although the UCC-1 Financing Statement does not require signatures, any attachment such as the legal description or special terms and conditions may require the signature of the Debtor.
A UCC-1 Financing Statement expires after five (5) years unless a continuation is recorded and/or filed. It is the sole responsibility of the Secured Party to determine if a continuation is necessary and to record and/or file any continuation statement.