UCC Filing and Search Guidelines for Boats

All you should know about Uniform Commercial Code filings and searches.

The Uniform Commercial Code (UCC) in boating terms is a set of laws that regulate certain aspects of marine financing in the United States. These have been adopted and are enforced by all state-level jurisdictions in a consistent manner. The rulings are of special importance to prospective buyers and lenders when it comes to securing and prioritizing boat loans. This page will provide an in-depth overview of UCC filings for boats, how to implement them and where to conduct record searches.

UCC Collateralization

Collateralization is a term used for securing and perfecting a marine lender's financial interest in a particular boat. This typically involves the execution of a loan agreement, promissory note and security agreement. In the event of a default, the lender may accordingly implement a repossession, foreclosure and liquidation process according to applicable regulations. There is, however, a matter of prioritization with regard to competing security interests against the same boat. This is where a UCC filing may afford such protection depending on the method under which the boat is registered, titled, or documented.

Applicability and Priorities

Boats are viewed as personal property and may accordingly fall subject to UCC regulations when it comes to securing marine loans. A UCC financing statement can be filed against any boat which will place the public on notice of the underlying security agreement. However this may become subjugated to higher priorities depending on the kind of filing and the boat's titling status.
Non-titled Boats - A UCC filing is the only venue available for securing loans on boats that are neither state titled or USCG documented. However, this will become subordinated to any subsequent state title recordings or mortgages associated with USCG documented vessels.
State Titled Boats - Security interests recorded on state boat titles will gain priority over any UCC filings. However, these are in turn both subordinate to any preferred vessel mortgages.
Documented Vessels - When a mortgage becomes recorded against a USCG documented vessel, it automatically gains priority over any state title or UCC recordings.
Outboard Motors - UCC filings are effective against outboard motors unless they have become titled in those states that provide such an option.
Personal Property - As a precautionary matter, lenders will often submit UCC filings against any items of personal property onboard that may be considered extraneous to the boat's operational status.
Delinquent Taxes - State and federal agencies may file UCC recordings on delinquent taxes regardless of the boat's title or documentation status. However, these priorities may be questionable depending on whether such debts are qualified as actual maritime liens. Concerns about such matters should be discussed with the filing agency, the owner or perhaps a qualified attorney.

Filing Forms and Instructions

UCC filings are quite easy to record by anyone and do not require a boat owner's participation beyond the execution of a loan security agreement. Most states have their own set of UCC filing forms along with ample instructions that can be found in the State Registration Overviews, links to which are shown in the References for this page. You will also find a link in the References for universal UCC forms and instructions.
Proper Jurisdiction - The proper jurisdiction for filing a UCC recording is typically the state in which the debtor is domiciled. Although nothing prevents UCCs from being filed in other states as a precautionary measure, this may cause confusion and creates an additional burden when it comes to fees, renewals and terminations.
Recording Agency - The usual recording agency for UCC filings is a secretary of state's office. However, these may be handled by different agencies depending on the jurisdiction. The State Registration Overviews found in the Referrals for this page will provide such information.
UCC Financing Statement - The filing begins with a UCC-1 financing statement which includes a set of instructions that should be adhered to carefully.
Debtor Names - The UCC-1 form describes how to list the debtor name or names. As a matter of consistency, these should match up with the security agreement and boat registration certificate if applicable.
Collateral Description - The subject boat should be fully described on the UCC-1 with the year, make, model and length. All boat identification numbers should be correctly listed, especially the hull identification number. A state registration number and official documentation number should also be shown if applicable. Any personal items not part and parcel to the boat itself should be fully described.
Security Agreement - Anyone can arbitrarily file a UCC-1 financing statement as a matter of public notification. In order for it to become effective, however, it should be accompanied by a copy of the security agreement as signed by the indebted party. There may also be legal implications for filings unrelated to a financing arrangement.
Renewals - UCC filings must be typically renewed every 5 years. This is implemented by filing a UCC-3 continuation statement with the appropriate recording agency. The continuation must usually be filed within six months before the original UCC-1 filing expires.
Ancillary Filings - Ancillary filings may be required in the case of additional information or corrections. Forms for these are available from the Referrals for this page.
Filing Fees - UCC recording fees are usually minimal and the respective schedules can be found in the State Registration Overviews found in the Referrals for this page.
Termination Statement - UCC filings may be terminated by filing a UCC-3 amendment form. This includes a checkbox for such purpose. It should be filed in a timely fashion in order to avoid liability for damages to the debtor.

Search Instructions

Uniform Commercial Code (UCC) searches are necessary when checking to see whether a particular boat is subject to any such filings. This is especially important on boats that are not state titled or USCG documented. Although most states have online portals that will accommodate UCC searches, it may be necessary to submit a UCC-11 Information Request form. This and instructions can be found in the State Registration Overviews link shown in the Referrals for this page.
Gathering Information - In order to initiate a UCC search, you will need to gather information about the owner, the subject boat, and where it is registered when applicable. UCC databases can only be searched by an owner's name unless a filing number happens to be available. You will also need to have a description of the boat, its identification numbers, where the owner resides and the state in which the boat is registered if applicable. This will help in determining whether the filing is actually related to the boat.
Where to Search - You should conduct your search in the state of an owner's residence and the state where a boat is registered if different. If there is any ambiguity regarding such factors, a search should be conducted in all potential jurisdictions.
Conducting the search - Most of the states will provide online access to their UCC records. If not, you will need to submit a UCC-11 Information Request form. Details on how to go about this can be found in The State Registration Overviews link shown in the Referrals for this page. Searches should be initiated as applicable under a business name, the owner's legal name, a byname, and name shown on the registration certificate if different. This may accordingly require multiple searches. You will also need to conduct separate searches for multiple owners.
Obtaining Record Copies - Whenever a UCC record is identified, you will need to obtain a copy of the filing in order to determine its specific details. These can usually be ordered online from the recording agency or you can submit a UCC-11 Information Request form for this purpose.

Conclusion

The guidelines shown here are general in nature and may contain errors, omissions or inaccuracies. You should contact the appropriate filing agency or consult with attorney regarding any such concerns. You may also wish to utilize a professional Uniform Commercial Code service company for assistance with such matters. A link to nationwide providers can be found in the Referrals for this page.

References and Referrals
Comments - Suggestions - Corrections