We have customers who borrow funds for different projects and we have a general all asset UCC filing as collateral. If during a period of time our customer does not have an active loan balance:

1. Does our filing maintain priority over any filings that are done during the time the customer has no active loans with us?

2. Will we be required to file a new UCC once they are actively borrowing again?

You may not have received a response due to either the limited activity in the Article 9 forum or the wide variation in the states' implementation of Article 9 (the Uniform Commercial Code isn't).

I'm going to transplant this thread to the Lending forum to see if it gets some attention. If that isn't successful, I suggest you repost in the New York forum.

Not an attorney, but my understanding of filings is that they are in chronological order - no need to have an active loan.

Many years ago, we lost our filing (someone did not file a continuation). We got a UCC-11 and found someone near the top of the list and after a few calls, they assigned their position to us, near the top.

We lost our lien position a few years ago. We were the 1st to file, and we had attachment -- but borrower came in and paid us off. We filed a continuation anyway -- borrower came back in and borrowed money -- loan officer didn't do a search (seriously, its $1 in my state) because officer knew we had a blanket lien on all equipment and knew we were in first position.

Well, we weren't. Borrower had gone down the street after he made the loan with us in which we had 1st position and that lender took a chance to be in line behind us. When borrower paid us off and we no longer had attachment to anything active -- we are now in second position. We have titled collateral so, we are okay -- but you have to have something to attach to.

Sure, you CAN continue those UCCs forever and forever, but you DO have to have an active loan to maintain lien position. And if there's ANY gap in you having a loan, do those searches to ensure your position.