On December 17, 2014, Sub-Part 1 of UCC Section 9-503 titled, “Name of Debtor and Secured Party” was amended in order to more fully explain how the Debtor ‘s name should appear on a UCC-1 Financing Statement. By conforming to the statute, a lender will now know that a UCC-1 Financing Statement has been properly prepared and will become an effective Financing Statement providing public notice of the transaction.
Some of the major points of the amendment are as follows:
If the debtor is a registered organization, an LLC for example, the Financing Statement must provide the name of the debtor as indicated on the public records of the jurisdiction where the debtor was formed. In New York, this would be the name shown in the Office of the Secretary of State.
If the debtor is a trust, or a trustee, the Financing Statement must provide the name specified for the trust in its organization document, i.e. The Trust.
If the debtor is an individual, the Financing Statement must provide the correct name of the individual as shown on a NY State Driver’s License. If that name is not identical to the name on the stock certificate, then the name on the stock certificate must also appear on the Financing Statement. The statute, attached, provides for a variety of other types of debtors, and should be consulted in each case. The secured party should obtain an affidavit from the debtor together with photographic identification in order to verify the correctness of the debtor’s name. Such an affidavit is attached, and will appear on Judicial’s website.