UCC Financing Statements: Underwriting Guidelines

Any existing or newly filed financing statements covering fixtures must be excepted on the final title policy. If the financing statement has been assigned or continued, the exception should reflect the original financing statement as well as the assignment or continuation. If the agent can ascertain that the personal property secured by the financing statement or chattel mortgage has not become a fixture and thus real property according to the law of the jurisdiction, then it is permissible to omit these recorded statements for the loan policy. However, it is advisable to disclose the existence of these statements to the proposed insured for informational purposes. 


An agent should never insure machinery, equipment, or fixtures as part of the insured land without prior approval of Agents National Title underwriting counsel. 


Commitments and policies should contain an exception to any financing statement that affects the property if it has not been properly disposed of. 


Contact your local Agents National Title counsel for any questions regarding specific provisions of your state.