Because understanding liens shouldn’t feel harder than figuring out your old MySpace HTML.
If you’re a millennial, you’ve survived rotary phones (at your grandparents’ house), AIM away messages, and the emotional toll of waiting 30 minutes for a burned CD to finish. But somewhere between Oregon Trail and adulting, no one ever explained UCC searches – and yet they play a huge role in how loans, equipment financing, and business credit actually work.
So let’s break it down like you’re five, without losing the real industry substance.
First: What Even Is a UCC?
A UCC is short for the Uniform Commercial Code. It’s a nationwide set of rules that helps keep business transactions predictable and orderly. But the part we care about is the UCC-1 financing statement.
Think of it like this:
- You’re a kid with a shiny new toy truck.
- Your friend loans you some stickers, but only if they can “claim” your truck until you pay them back.
- To make it official, they tell the whole playground: “If this kid doesn’t return my stickers, that truck is mine.”
That public announcement?
That’s what a UCC filing does for lenders.
It tells the world: “We have a security interest in this borrower’s stuff until they pay us back.”
What Is a UCC Search?
If the UCC filing is the public announcement, the UCC search is checking the announcements before doing business with someone.
A UCC search is a review of state-recorded filings to see:
- Who else has a claim on a business or an individual’s assets
- Whether the borrower has already pledged their assets as collateral
- Whether a lender still has an active lien
- Whether old filings were never terminated
It helps lenders avoid surprises that could cause big financial problems later.
Think of it as checking whether someone already “borrowed” your future toy truck before you agree to loan them anything.
Why UCC Searches Matter in the Real World
UCC searches are a huge part of commercial lending, equipment financing, small business loans, and even some real estate-related lending.
They matter because:
1. Lenders must confirm priority.
If multiple lenders loan money to the same borrower, whoever files first usually gets paid first. A UCC search confirms where everyone stands.
2. Borrowers can’t give away the same collateral twice.
This protects lenders from getting stuck behind existing claims they didn’t know about.
3. It helps identify risk before a deal closes.
A UCC search reveals liens, judgments, and sometimes even red flags like fraudulent filings.
4. It creates transparency in secured transactions.
Everyone sees the same public record, so there’s no guessing game.
What Title and Search Companies Do in All This
While attorneys or lenders can run searches themselves, they often rely on professional search firms because:
- Names must be entered precisely.
- State systems vary wildly in quality.
- Debtors may have multiple name versions or corporate changes.
- False positives and near matches need expert interpretation.
- Errors can create costly priority problems.
Search companies (like Capitol Lien) provide:
- UCC state-level searches
- County or court searches for related risks
- Copies of filings
- Expert review to confirm hits, possible matches, and hidden liens
- Continuation alerts and portfolio monitoring
Basically, they help prevent “oops” moments that could derail a loan. By skipping a UCC search, skipping a UCC filing, or not ensuring that the UCC is filed correctly, you are saying “If you default or file for bankruptcy, I’m cool with not getting anything in the distribution of your assets.” Sounds like something a financial professional would say, right??
What Shows Up in a UCC Search?
A typical UCC search may reveal:
- Active financing statements
- Lapsed filings
- Continuations or amendments
- Assignments
- Terminations
- Federal tax liens
- State tax liens
- Judgment liens
- Fixture filings
- DBAs or other associated names
In millennial terms:
It’s like checking someone’s digital footprint before you date them… except way more official and a lot less cringey.
MIMS Summary
If you remember nothing else, remember this:
- A lender files a UCC to claim collateral.
- A UCC search checks whether others already have claims.
- Lenders use it to avoid financial risks.
- Search companies make sure nothing is missed.
- It keeps secured transactions safe, transparent, and compliant.
UCC searches are basically the adult version of saying, “Let me see who already called dibs.”
Final Thoughts
Millennials entering roles in lending, legal, operations, or compliance often get dropped into conversations about UCCs with zero context. But once you understand the playground analogy, it all makes sense:
We’re just documenting who gets what if things go sideways.
About the Author
Marissa Berends is a Certified Abstractor and Industry Relations Coordinator at Capitol Lien, a nationwide due diligence and risk mitigation services provider. Since joining the company in September 2021, she has earned abstractor certifications in Minnesota, Nebraska, and North Dakota, and most recently graduated from the Wisconsin Land Title Association’s Title Examiner courses.
Marissa is involved with the following groups: Women in Title (WiT); Wisconsin Land Title Association’s (WLTA) Convention Committee, Membership Committee, and Young Title Professionals; Property Record Industry Association (PRIA) National Education Committee; Illinois Land Title Association’s (ILTA) Inclusion, Diversity, Equity & Acceptance (IDEA) Committee; Minnesota Land Title Association’s (MLTA) Education Committee, American Land Title Association’s (ALTA) Title Advisory Network (TAN), Michigan Land Title Association’s (MLTA) New Title Professionals, and the National Association of Land Title Examiners and Abstractors (NALTEA).
About Capitol Lien
Capitol Lien empowers real estate and title professionals with trusted public record research and due diligence services nationwide. With over 30 years of experience, Capitol Lien specializes in fast, accurate property and title searches, lien reports, and document retrieval that help title agents, underwriters, and legal teams operate their businesses with confidence. The Capitol Lien team takes the hassle out of title research with local experts and innovative tools that make it easier to mitigate risk, stay on schedule, and keep your closings moving smoothly.
Learn more at capitollien.com. Ready to simplify your title research? Send your next order to Capitol Lien and experience the difference trusted diligence makes. Stay in touch with Capitol Lien on LinkedIn for industry updates and information. Reach out! contact@capitollien.com or 800-845-4077