How should a lender document a Hypothecation agreement on personally owned REMs to secure his business loans. Should the hypothecation be listed as security on the note, security agreement, UCC-1? Thank you for your help.

You should be asking your attorney as State law will come into play and there may not be a standard answer.

Most hypothecation agreements, that are not real property related, are essentially a security agreement where the one with rights in the property is not the borrower. Since the passage of Revised Article 9 and the new definition of the term debtor, they have become irrelevant and not needed.

In what way is the hypothecation being used?