When banks or lenders provide business loans, they will often require a debtor to permit the filing of a UCC Financing Statement or a “fixture filing” to secure the loan against equipment or fixtures. The Weaver Law Firm provides legal opinions in transactions between lenders and borrowers. As part of that process, a UCC document may be filed. Where?
You may file the UCC document with a Texas county clerk for the filing or recording of a mortgage on the related real property if: (1) the collateral is as-extracted collateral or timber to be cut; or (2) the financing statement is filed as a fixture filing and the collateral is goods that are or are to become fixtures. To make sure that you file your documents with the correct local or state level, contract an experienced attorney with experience in business transactions.
In other situation, you can file a UCC document or UCC1 financing statement with the the Texas Secretary of State. In many of these situations, a company is buying a business and requires a business loan. Generally, that process starts off with a Letter of Intent and due diligence is performed. Then, in the borrowing process, the loan documents will likely require a UCC filing.
Chapter 9 of the TX Business and Commerce Code (i.e., UCC provisions) states as follows:
Sec. 9.501. FILING OFFICE. (a) Except as otherwise provided in Subsection (b), if the local law of this state governs perfection of a security interest or agricultural lien, the office in which to file a financing statement to perfect the security interest or agricultural lien is:
(1) the office designated for the filing or recording of a record of a mortgage on the related real property, if:
(A) the collateral is as-extracted collateral or timber to be cut; or
(B) the financing statement is filed as a fixture filing and the collateral is goods that are or are to become fixtures; or
(2) the office of the Secretary of State, in all other cases, including a case in which the collateral is goods that are or are to become fixtures and the financing statement is not filed as a fixture filing.
(b) The office in which to file a financing statement to perfect a security interest in collateral, including fixtures, of a transmitting utility is the office of the Secretary of State. The financing statement also constitutes a fixture filing as to the collateral indicated in the financing statement that is or is to become fixtures.
If you are a borrower seeking a lender needed Opinion Letter, The Weaver Law Firm can help. If you are a lender and require Escrow services or the filing of lien documents, our business and financial institution lawyers can assist. You may reach us at 713-572-4900.