Notification Requirements For Notice of Security Interest

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Question:

How often should you send a Notice of Security Interest to a buyer of farm products in a state that does not have central filing for farm products? As we are surrounded by states that are not EFS states, we send Notice of Security Interest or Direct Notifications to feedlots, but we're not sure if continued notification is annual or 18 months or something else

Answer:

You must send the notice on an annual basis. If a state has not adopted a Centralized Notification System(CNS) and uses the direct notice option of 7 U.S.C. 1631 a buyer of farm products,a commission merchant or a selling agent who has received a written notice of a security interest within one year takes or sells the farm products subject to the security interest. See 7 U.S.C. 1631(e)(1) and (g)(2)(A) and (B).

First published on BankersOnline.com 08/12/02