As 2011 draws to a close, First Corporate Solutions is taking to our blog to offer suggestions for how our readers can decrease their spending for due diligence related tasks in the upcoming year. Last week, we discussed strategies for reducing the costs for lien searches while this week we tackle UCC filings. Herein, we share a couple of simple changes you can make to reduce your UCC filing costs.
One of the most effective ways to reduce UCC filing costs is to file electronically. The filing fee for an electronically filed UCC document is often substantially lower than the fee to file the same document using traditional “over the counter” service. Electronic filing (aka E-Filing) is now available in most states and there are a couple of different ways to get your document on record electronically.
One common way to E-File a UCC document is by visiting a state filing office’s website and inputting debtor, secured party and collateral information into their online UCC filing system. Many states now offer this feature and users can pay either by using a credit card or by establishing a pre-paid account. This method is particularly useful for those who have infrequent filing needs.
For high-volume UCC filers, an even better E-Filing solution is to file electronically using a private service company’s web-based filing system. These systems use xml technology to transfer data directly to the state filing office. In some cases, the xml filing fee is a mere fraction of the manual filing charge. As an added benefit, many online filing systems include portfolio management tools to help you keep track of all of your UCC filing activity.
Another simple way to drive down UCC filing costs is to reduce your number or rejected filings since the process of correcting and resubmitting a UCC document can get pretty expensive. In many states, the filing office will retain a portion of the filing fee for a rejected document. And if you work with a service provider to submit UCC documents on your behalf, they may charge a rejected filing fee or special handling charge to process your rejected document.
There is also the cost of labor to consider. When a filing office rejects your UCC document, it then requires more of your time to track down the correct information, make the change to the document and resubmit it to the filing office. This is time you or your staff could spend on other, more profitable tasks.
To reduce your number of rejected filings, try utilizing a service company that will perform a thorough quality review of your UCC filings prior to submission.
Mark your Calendar!
On March 15, 2012, First Corporate Solutions will be hosting a FREE webinar event, “An Insider’s Guide to Reducing Due Diligence Costs.” Check back on the blog or look to our website at www.ficoso.com for registration information as the event date approaches.