Demand Letters and UCC Filings

What You Should Know about Demand Letters & UCC Filings

The demand letter is often overlooked as a collection tool for UCC filers, but it can be a cost effective alternative to the processes of repossession or litigation. As we’ve mentioned before, demand letters are not kind, gentle, love notes. Demand letters are typically harshly worded, authoritative notifications – after all, the definition of demand is “…an insistent and peremptory request, made as if by right.” which loosely translates to mean “It’s mine! You have it, pay me or give it back.”

What Should I Include in a Demand Letter?

Always remember to be factual & succinct. When you have filed a UCC, you should use that filing as leverage within your demand letter. Make sure to include the following information in the demand:

  • Date of the demand
  • Your company’s name and contact information
  • Your debtor’s name and contact information
  • The date the Security Agreement was executed
  • The UCC filing number and the date of the filing
  • Reference to the Collateral Description
  • Reference to the Default Terms
  • The amount of the debt
  • The due date of the debt
  • How the debt should be paid
  • The consequence of not paying the debt

You are probably wondering “How on earth can I be succinct when I have to include ALL of this information?!” And the answer is to remember to stick to the facts, no additional commentary or emotion need be in the demand, just the facts.

Who Should Receive a Copy of the Demand Letter?

The demand should be served upon your debtor and it is recommended you include a copy of the Security Agreement and a copy of the UCC filing.

There’s a Consequence for Every Action

Always include a description of the consequences for not paying the debt.  It’s important to include realistic ramification: …If payment is not received, we may pursue all available legal remedies available under the Ohio Uniform Commercial Code.”

Can I Send a Demand Letter even if I Didn’t File a UCC?

Yes, absolutely YES! There are no prerequisites for sending a demand letter, other than the outstanding debt.

When Should I Send a Demand Letter?

You may find a demand letter to be most beneficial before attempting to repossess your goods or before proceeding with enforcement of the UCC filing under the Uniform Commercial Code.

 Looking for an example of a general demand letter? Download one for free

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