While you may be familiar with UCC filings, it’s always a good idea to ensure you understand the importance of this financial statement. UCC, Uniform Commercial Code, is a set of laws designed to provide consistency across all 50 states on commercial and secured transactions, such as the sale of vehicles. If you are an auto dealership that provides financing services to your customers, you will most likely need to conduct UCC filings as part of your business. Consolidated Automotive Services of Indiana understands the ins and outs of UCC filings and why they are important to your vehicle dealership. Keep reading to learn more about UCC filings for your automotive business.
What Is a UCC Filing?
While there are several types of UCC filings, the most common one is a UCC-1. This is a financial statement that provides notice to interested parties that their personal property, such as a vehicle, is being used as collateral for a secured transaction, like a vehicle loan or lease.
When Should You File a UCC Statement?
Anytime you provide financing for a vehicle, you should file a UCC statement. This statement serves as a public notice that you, the creditor, have entered into an agreement with the debtor. A UCC filing protects you, the creditor, in case the debtor cannot keep up with their part of the loan or lease agreement, such as making the agreed-upon vehicle payments. It confirms that your dealership holds a vested interest in the vehicle used as collateral, and can retain ownership of that vehicle if the conditions of the loan or lease are not upheld.
How Long Is a UCC Filing Valid?
A UCC filing is good for up to five years. If the debtor (buyer of the vehicle) still owes on the vehicle in question, you can apply for another UCC filing before the end of the five-year period. You do not want to let this filing lapse, as you would lose all interest in the vehicle if the owner encounters financial difficulty and cannot make his or her payments.
Reliable UCC Filings
The team at Consolidated Auto can take care of this time-consuming task for you. Call us at (812) 988-8300 to request a quote. We serve all 50 states with our vehicle title services such as corrected titles, salvage titles, replacement titles, title transfers, and more.
Source: Taylor, Alexis Jacobson. “Your Questions Answered: What Is a UCC Filing.” Web article. Wolters Kluwer. Wolters Kluwer N.V. 17 Jun. 2017. Web. 15 Feb. 2021.