Here Are 4 Reasons We LOVE UCC Filings
In honor of Valentine’s Day, here are four reasons we love UCC filings — and you should too!
- Security: If you could protect your accounts receivable, inventory, or equipment, would you be willing to offer larger credit lines to your customers? After all, larger credit lines mean you can sell more and even more competitively than others in your industry! UCCs provide you with the security you need to seize opportunities and to reach more accounts you may have previously passed on due to thin credit history.
- Inexpensive: UCCs are inexpensive and require little long-term maintenance, easily saving you thousands in the event of customer default or bankruptcy. Plus, there is NO COST to your customer! Filing a UCC doesn’t require anything other than your customer’s signature and it will not negatively impact their credit.
- Available: What’s a better reason than “Because you can!”? As a creditor, you have the right to protect your interests. So why risk it? Take this opportunity to exercise your right to recover funds (or inventory/equipment) if your customer fails to pay you.
- Common: Come on, everyone’s doing it! It’s true, businesses throughout the country file UCCs to ensure they are in the best possible position to get paid. Don’t think your competitors are? Think again – run a search on your customers and you will likely see the UCCs filed by your competitors.
OK, how about one more reason?
Smart: Securing your receivable is smart business. Plain and simple. In business, goods and services are rendered for payment; you have every right to ensure you are paid. UCCs were created to promote commerce and to protect creditors like you.
Use UCCs and you are certain to love them as much as we do!
- UCCs are a common business practice.
- UCCs will not impair your customer’s credit rating.
- In bankruptcy, secured creditors have priority and are paid before unsecured creditors.
- In the event of default, a properly perfected security interest (i.e., your UCC filing) provides you the right to repossess your goods or equipment.
- UCCs promote sales opportunities by providing security when selling to marginal accounts.