A way for a vendor or lender to register a security interest in property in the United States pursuant to the Uniform Commercial Code. The UCC allows a creditor to notify other creditors about a debtor’s assets that are pledges as collateral against payment by filing a public notice (financing statement) with a particular filing office. Such a filing prevents reuse of the item as collateral for another debt or a purchaser claiming to be bone fide purchaser. The first step in making a UCC filing is to require the debtor to execute a UCC-1 financing statement, which is then filed with the appropriate filing agency. Filings are made either with the state(s):
(1) in which the organization is registered, e.g., the state of incorporation or where it is registered to do business;

(2) of the entity’s headquarters if the entity is unregistered and has more than one place of business; or

(3) where an individual resides in the case of an individual or sole proprietor.

“If a company should collateralize all of its assets in a “”blanket”” security statement, the assets cannot be sold or reused unless the creditor voluntarily releases parts of the secured collateral or the debt is to be paid in full. Four types of assets commonly used as UCC collateral:
(a) accounts receivables; (b) inventory; (c) equipment; (d) anything else with recoverable value. However, the UCC-1 is a negotiable instrument. Thus if a company wants a small credit line but is owed substantial low-risk accounts receivable it could use just some of its accounts receivable as collateral, excluding the rest and its inventory and equipment available for future use as collateral. Companies in the US regularly have multiple UCC-1 filings on specific pieces of their equipment or vehicles.”