Financing Statement Expiration

There does not appear to be any rule against filing a new financing statement after the lapse of the original UCC-1 filing, but your priority in the collateral will not date back to the original financing statement filing. Accordingly, an intervening creditor with a perfected security interest will have priority in the collateral. The general rule under revised Article 9, section 9-515, is that a financing statement lapses after 5 years. A continuation statement may be filed only within 6 months before the expiration of the 5-year (initial or renewal) period. When the period of effectiveness expires, the effectiveness of the financing statement lapses.

First published on BankersOnline.com 7/16/07