Basic Uniform Commercial Code


When a debtor has insufficient assets to satisfy his creditors, those with priority take first.

Creditors generally take in the order:

  1. Statutory lien creditors
  2. Perfected PMSI creditors
  3. Perfected creditors
  4. Judgment lien creditors
  5. Unperfected attached creditors

The default priority rule is that the first to file or perfect has priority. UCC § 9-322(a)(1).

Thus, in financing, unlike in real estate, the lender will always want to file a financing statement as the first thing they do.

You can even amend your filed statement to attach first to previously unperfected property. It doesn't change the filing date.

If no one is perfected, the first to attach wins.

An unperfected secured party beats an unsecured party.

If A files, then B does something, then A attaches...

Future Advance Interest

The code honors future advance interests the same as any other.

UCC § 9-323.

Purchase-money security interests have priority over conflicting security interests in the same goods if the PMSI is perfected within 20 days of the debtor taking possession. UCC § 9-324.