In the September/October issue of our Community Banker newsletter, we discuss a “lender’s golden ticket.,” which is UCC Priority.
Being perfected in the collateral doesn’t always mean that your bank has priority in the loan collateral. “Perfection” means that the bank has completed the process required by the UCC to make a security interest in collateral in force and enforceable against third parties. “Priority” is the first-in-time ranking of that perfected security interest among lenders. The point of perfection is for your bank to claim priority over other claimants to the collateral.
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