UCC lien
A UCC filing is a public notice that a funder claims an interest in your receivables. It is routine, and it matters when you want new financing.
✓ Checking what you qualify for does not affect your credit score.
At Merchant Fund Express, here is the short answer: A UCC filing is a public notice of a funder’s interest in receivables. It does not take anything from you, and it should be terminated after payoff.
A UCC-1 financing statement is a public record filed with a state office. It tells other lenders that the funder has an interest in certain business assets, usually receivables or all assets. It does not take anything from you; it establishes priority. See UCC filing and blanket lien.
You keep operating normally. The filing is visible to other lenders when they check.
A new funder sees the earlier claim and may require it to be released, subordinated or paid off.
A filing signals an existing position and affects pricing and approval.
| Event | What follows |
|---|---|
| Pay off the advance | Funder files a UCC-3 termination |
| Buyout or refinance | Payoff letter; termination filed on payoff |
| Confirm | Search your state filings a few weeks after payoff |
Ask for the termination in writing and check that it has been filed. A filing left in place after payoff can get in the way of a new line of credit or loan.
See contract terms to read and funding with a UCC lien on file.
An owner pays off an advance and applies for a line of credit three months later. The new funder finds the old UCC filing still in place and asks for a termination. She had never requested it. A single email, a UCC-3 filing and two weeks later, the file is clean and the line is approved. A stale filing is a paperwork problem, but it can cost a month.
Source: Merchant Fund Express.
It does not appear on a personal credit report. It is a public business filing. That is how Merchant Fund Express reads it on a real file.
Usually the lien has to be released or paid at closing.
Typically five years unless continued, but check your state.
Ask in writing. State procedures exist to remove a filing after payoff; consult an attorney.
Merchant Fund Express gives a same-day decision. Applying takes a few minutes and will not affect your credit score.
