Continuation Statement - Explained
What is a Continuation Statement?
Written by Jason Gordon
Updated at September 26th, 2021
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What is a Continuation Statement?
A continuation statement refers to modification or alteration made to a UCC-1 (financing statement) which makes it effective beyond its normal expiration date. The effect of a continuation statement is that a lien placed by a lender on the collateral of a borrower is extended beyond the original expiration date identified in the UCC-1 financing statement. Continuation statements are otherwise called UCC-3 continuation statements.
As stipulated in section 9 of Uniform Commercial Code, the continuation statement must be filed six months before the UCC-1 expires. A timely filing allows the extension of a financing statement five years after its filing date.
Lenders who do not file at this time are denied any extension or amendment to the expiration date of the financing statement.
Back To: COMMERCIAL LAW: CONTRACTS, PAYMENTS, SECURITY INTERESTS, & BANKRUPTCY
Related Topics
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- Perfecting a security interest in personal property?
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- Security interest in real property (land)?
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- How is a security interest created in Assignment of Accounts Receivable and Contract Rights?
- Perfect a security interest by Possession of the collateral?
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- Perfect a security interest by Filing a Financing Statement?
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- Defeasance
- Continuation Statement