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What is a UCC-1 lien?
A UCC-1 lien is a public filing that records a lender's legal claim on a specific asset you've pledged as collateral. It's standard practice in secured lending. It doesn't take your asset away — it simply gives public notice of the lender's interest in it until the loan is repaid, when the lien is released.
What does a UCC-1 actually do?
"UCC" stands for the Uniform Commercial Code, a set of standard rules used across US states for commercial transactions. A UCC-1 financing statement is the form a lender files to publicly record — or "perfect" — its security interest in collateral.
In plain terms, the filing puts the world on notice that a particular lender has a claim on a particular asset until a loan is paid off. It's a routine, protective step, not a penalty.
When is the lien filed and released?
On MarketLoan, the UCC-1 is filed when your loan agreement is accepted — the same moment you agree to the loan and to your asset going into custody. Filing it at origination is standard practice that protects everyone in the transaction.
When you repay the loan in full, the lien is released and your asset is returned to you. The claim only ever applies to the specific asset you pledged.
Does a UCC-1 hurt my credit?
A UCC-1 lien is about a specific asset, not a judgment against you. The claim is limited to the pledged collateral. Any details relevant to your situation are disclosed clearly before you accept an offer — nothing about the lien is hidden.
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