Quick Overview: When To File A UCC With The State Or County

In accordance with 679.5011, F.S., a UCC Financing Statement may be filed with the State and/or the County, depending on the collateral’s classification. So from a title insurance perspective, where do you file your UCC?

Let’s start with a short background on the UCC Financing Statement. A properly filed Uniform Commercial Code (UCC) Financing Statement Form is utilized to create a lien upon the personal property (collateral) associated with real estate. Where a mortgage is a lien upon the real property, a UCC Financing Statement may be a lien upon fixtures, inventory, general intangibles and other personal property. For example, a restaurant may obtain a loan to purchase a building and kitchen appliances – commercial stoves, dishwashers, etc. The lender will place a mortgage upon the real estate to secure its interest in the building/land and file a UCC Financing Statement to create a lien upon the kitchen appliances. Furthermore, some personal property can become so related to the real property that an interest in them arises under real property law – this type of property is referred to as a fixture. For example, the commercial stove that is bolted down and welded to the building may be so affixed to the real property that it is classified as being a part of the building now. From a title insurance perspective, personal property interests are not insured under an Owner’s or Loan Policy. Therefore, a title search will not include any UCC Financing Statements filed with the State – only the UCCs that are liens upon the real property fixtures recorded in the County records.

As 679.5011, F.S., states, the UCC Financing Statement should be filed with the circuit court (county recorder) if the collateral is as-extracted collateral or timber to be cut; or the collateral is goods that are or are to become fixtures and the financing statement is filed as a fixture filing. In all other cases, the UCC should be filed with the state – see FloridaUCC.com for forms and additional information.

Title examiners will be looking for what’s typically a three page document – the UCC-1, UCC-1 Addendum and an exhibit containing the legal description. The first page contains the Debtor’s and Secured Party’s information together with a description of the collateral. The second page is the UCC-1 Addendum which details if the financing statement is a fixture filling and the real property information – the description of real property box can state “as contained in Exhibit A”. Exhibit A contains the legal description of the real property.

In preparing a title policy, the UCC Financing Statement is typically recorded after the mortgage – and is shown as a subordinate matter on the Loan policy or an exception on the Owner’s Policy. When a property is being sold or refinancing, the examiner will require the UCC be terminated by filing a UCC-3 Form.

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