Debtor Name Changes Under UCC Article 9: The Importance of Keeping Financing Statements Current and Accurate
By MaryB. Cowan, President NCS, in collaboration with: Professor Margit Livingston, DePaul University College of Law
As all secured creditors know, maintaining perfection of their security interests is essential to ensuring priority over other claimants and to the survival of their interests in bankruptcy. The most common method of perfection under U.C.C. Article 9 is the filing of a financing statement in the appropriate public record. U.C.C. § 9-310 (a) (Official Text 2013). In filing a financing statement, the secured party (SP) must provide all of the required information on the document and also file it in the correct location. See U.C.C. §§ 9-301 (1), 9-501, 9-502, 9-516 (b). But even if the secured party performs all of those initial steps correctly, post-filing events can cause a financing statement to become ineffective and can result in loss of perfection. In particular, post-filing changes in the debtor’s name can invalidate the financing statement with respect to certain collateral, so it is critically important to know the rules in this area. See Gugino v. Wells Fargo Bank Northwest, N.A. (In re Lifestyle Home Furnishings, LLC), 2010 Bankr. LEXIS 111 (Bankr. D. Idaho Jan. 14, 2010).