What is a "UCC lien," and how does it impact commercial financing in Pennsylvania?

A UCC lien refers to a lien filed under the Uniform Commercial Code (UCC), which secures a creditor’s interest in a business’s assets (such as inventory, equipment, or receivables) as collateral for a loan. In Pennsylvania, the UCC-1 Financing Statement is filed with the Department of State to notify third parties that the lender has a secured interest in the business’s assets. This lien protects the lender’s ability to claim the collateral if the borrower defaults on the loan.

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