“Perfecting” Your UCC Tracking Process

“Good ol’ Ronnie” is one of your favorite customers to work with.

A fifth generation farmer, Ronnie is among the bank’s most loyal customers. In fact, his father, grandfather, and great-grandfather did all of their banking with your financial institution. And, since taking over the family farm thirty years ago, Ronnie has carried on the tradition – relying on your bank to finance his planters, sprayers, combines, and other equipment. He’s even turned to you when financing large land acquisitions, allowing him to significantly scale his farming operations.

Serving customers like Ronnie is no doubt fulfilling, but doing so creates a substantial amount of administrative work for your bank. UCC document tracking and management is a big part of that.

In this post, we’ll discuss why an automated, paperless approach to UCC tracking can streamline your bank’s loan administration.

Why Manual UCC Tracking is Inefficient

When it comes to financing Ronnie’s farm, your bank has taken several pieces of collateral over the years. For non real estate collateral like livestock, grain, and equipment, your bank ensures the enforceability of its security interest by perfecting the lien through a UCC financing statement. Depending on the collateral type, additional documentation must also be collected, such as valuations, inventory / equipment lists, flood determinations, and insurance policies.

Getting everything into the correct loan file has been difficult, to say the least. Your pre-booking checklists, although accurate, offer minimal accountability. Loan administrators routinely forget to indicate certain documents have been added to the loan file. Other times, they might mark a document as received when, in fact, it hasn’t been. They’re trying their best, but we’re all human and occasionally make mistakes. Unfortunately, when it comes to perfecting collateral for your commercial loans, a few mistakes can be very costly.

Upon booking the loan, your bank still needs to maintain solid tracking methodologies. For example, each UCC filing has a different expiration date. The five-year period can pass quickly and, without the proper exception management workflow, your bank may find itself scrambling to file continuations within the allotted 180-day window.

Paper documents add to the confusion. After all, a hard copy loan file can only be in one place at a time. However, it’s entirely possible for a single asset to serve as collateral for multiple loans. Just keeping the paperwork organized can seem like a full-time job.

Paperless, Automated UCC Tracking

Unlike spreadsheets, manual ticklers, and paper documents, an integrated imaging and exception management system can bring clarity to UCC tracking. Our AccuAccount platform, trusted by 15,000 bankers worldwide, delivers a scalable workflow for collateral perfection. For starters, our system’s prebuilt document structure will keep your entire team organized. As new collaterals are added to the system, AccuAccount prompts the user to collect proper documentation (based on the collateral type).

Collateral Add

Once a document has been scanned in, the intuitive color-coded indicator switches from red to green. Exceptions are automatically cleared as documents are added into AccuAccount, making manual ticklers a thing of the past.

Collateral Exceptions

AccuAccount’s exception reports deliver daily email reminders to key stakeholders, ensuring the collateral is perfected on time and to specification.

Sharing collaterals between loans is as easy as clicking a button.

Collateral Sharing

AccuAccount also helps with ongoing tracking obligations. Need your lenders to make quarterly on-site visits to perform a livestock count at Ronnie’s farm? Want to be notified exactly 180 days prior to a UCC’s expiration date? AccuAccount creates accountability and protects your bank from costly oversights.

Automate Your UCC Tracking

Ready to learn more about AccuAccount’s built-in UCC tracking capabilities? Check out our five-minute overview video to see what AccuAccount can do for you.

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Connect with Cathy Cirullo

Cathy Cirullo is the Implementation Manager at AccuSystems and has 30+ years of experience working in the banking industry. Having overseen loan operations departments, compliance programs, and retail operations, Cathy has extensive knowledge of loan and deposit documentation and regulations.