Glossary · Trucking Finance
UCC-1.
Uniform Commercial Code financing statement filed by a lender or factor to publicly establish a security interest in business assets.
What it is
A UCC-1 is a Uniform Commercial Code financing statement (Form 1) filed at the state-level Secretary of State office. It establishes a public lien — a security interest — on identified business assets, typically accounts receivable, equipment, inventory, or "all assets." UCC-1 filings last 5 years and are renewable.
Factoring companies file UCC-1s against accounts receivable. Equipment lenders file against the specific equipment. MCA providers often file blanket "all assets, all states" UCC-1s, which is more aggressive than what the underlying advance actually secures. Banks file against whatever the loan covers. A UCC search at the carrier's state Secretary of State is part of any commercial-loan due diligence — every prospective lender pulls one before approving a new facility, and pre-existing filings affect what additional collateral the new lender can attach.
Why it matters for trucking finance
A UCC-1 filing affects all future borrowing. A lender doing due diligence will see existing UCC filings and may decline if their security interest can't be perfected. Aggressive MCA providers file blanket UCC-1s that block factoring and equipment financing for years. Before signing any commercial financing, ask which UCC-1 the lender will file and on what assets. UCC-1 termination on payoff is the lender's responsibility but doesn't always happen automatically — verify after every payoff.
Related terms
- Merchant Cash Advance (MCA) — Lump-sum cash advance against future business revenue, typically with daily ACH deductions; high effective APR but easier qualification than term loans.
- Lockbox — Address or bank account designated for invoice payments where the factoring company receives broker payments directly, used to control collections.
- Recourse Factoring — Factoring arrangement where the carrier remains liable for unpaid invoices if the broker fails to pay; lower rates than non-recourse.
Related Dispatched products
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