What is your bank doing to comply with legal name changes Effective July of 2013.

Our state is going with the Drivers License as the legal name of the borrower and where there is not valid driver's license the First Name and First Surname apply.

How are you addressing verifying the name with your customer. Are you taking Driver's license copies? Recording expiration dates? etc. How are you addressing the mispelled or shortened name that appears on some licenses with your legal documents?
Will you use it, or show the borrower's name as is should appear and complete the filings with the Driver's license version.

Lots to think about here for procedures as we approach our renewal season. Wanted to get others opinions.
Thanks.

In Oregon, these changes went into effect in March, actually the same day the govenor signed the bill.

Name is verified by the Loan Officer to Portfolio Name on Core System.
No Copy of DL is obtained/No Expiration Date is obtained.
If there is a mispelling, we are filing on both names.

These are not the procedures that I argued for, but it is what we're currently using. I think it'll change once we take a loss or lose position because the officer neglected to get/verify the correct spelling. I'm going to a new institution Friday and will be reviewing their (our!) procedures and will probably need to make changes. I'm also interested in hearing what others are doing.

Is anyone else out there making changes or are they/we all just going to change on June 30th?

What are you doing about existing UCC's?

We are trying to come up with procedures to address the issue of exact name matches on the UCC with names matching drivers license also. I am looking for ideas on how to deal with this too. If we make copies of drivers license can we retain them in our electronic document management system, which loan officers have access to, without violating Reg B, fair lending or any other regulation?

Where can I find the information on changes going into effect in July?

I found this link in an article.

http://extranet.ali.org/directory/files/UCC9%20amendments%202010.pdf

This the article but I know very little about this. Just have started to look into it.

Changes to UCC Article 9 Effective July 1, 2013
July, 2012





Originally published: in the July 2012 issue of ABC-Amega's "Credit-to-Cash Advisor" e-newsletter

Uniform Commercial Code (UCC) Article 9 deals with all transactions (other than a finance lease) that maintain the creditor's interest in a debtor's personal property. The debtor can be an individual or any business entity, ranging from a registered corporation to a single proprietorship.

The last major revision of Article 9 occurred in 1998. It went into effect on July 1, 2001 and has been adopted in all fifty states. To learn more about that revision, read our 2007 article, Secured Transactions and UCC 9.

A decade later, a Review Committee was appointed by the American Law Institute (ALI) and the Uniform Law Commission (ULC) to review the practical application of Article 9. In 2010, this Committee suggested several amendments related to filing issues and other matters that had arisen since the 2001 revision went into effect. This was not intended as a major overhaul of the Article, but rather as recommendations for changes to sections that appeared to be creating significant problems in practice. The ULC recommended the July 1, 2013 nationwide effective date, along with a five-year transition period.

UCC Article 9 2001 vs. 2013 Some key provisions of the Article that have been revised in the 2013 version:


UCC §9-102(a)(68). -- Considered by many to be the most important amendment, the purpose of this revision is to provide increased certainty that the debtor name on the financing statement is the correct name for purposes of UCC 9.
2001 Version: States that the name on the "public record" is the correct name of the registered organization in a financing statement.

2013 Version: States that the correct name is now the name on the "public organic record", which is defined as any record available for public inspection, including those filed with or by the state to form an organization, e.g. articles of incorporation, articles of organization, limited partnership agreements.


UCC §9-105 clarifies the rules pertaining to "control" of Electronic Chattel Paper (ECP) to give secured parties more leeway for developing reliable systems for keeping track of and controlling such documents.
2001 Version: Gives a six-factor test for determining whether a secured party has control of electronic chattel paper.

2013 Version: Retains the six-factor test and adds a general test requiring that the system employed to evidence the transfer of the ECP "reliably establish the secured party as the person to which the chattel paper was assigned".


UCC §9-316: Makes it more likely that a secured party will remain perfected if a borrower moves to another states or sells to (or merges with) a debtor in another state.
2001 Version: States that perfected security interests that attach prior to a debtor's move to another state remain perfected for four months after the move.

2013 Version: Adds a new subsection (h) that provides for continued perfection of the newly acquired security interests that attach within four months after the debtor moves, as long as the secured party has taken steps that would have perfected the security interest in the debtor's original state. The perfection extends until the end of the four-month period.

A new subsection (i) has also been added. It provides for automatic perfection of security interests that attach within four months after a new debtor in another state becomes bound by an existing security agreement with the original debtor. Again, this applies as long as the secured party has taken steps that would have perfected the security interest against the original debtor.


UCC §9-503 -- As with §9-102(a)(68), this section determines the correct debtor name that should be included on the financing statement since minor variations in the names of organizations and individuals has made it difficult for secured parties to determine the proper name for a financing statement.
2013 Version: For registered organizations, the correct name is as listed in §9-102(a)(68). However, for individual debtors, there are two alternative provisions provided. State legislatures can select the alternative that best meets the needs of their constituents.


"Only If" Option: If the debtor has a driver's license or other state identification that has not expired, the name on that document may be used for the financing statement. If the debtor does not have an unexpired state ID, the secured party may use the debtor's first personal name and surname.

"Safe Harbor" Option: The debtor's name is sufficient for the financing statement if it is (a) the debtor's individual name as determined by state law, (b) the debtor's surname and first personal name, or (c) the name on an unexpired driver's license or other state identification.

UCC §9-516 revises the information required on the financing statement. The Uniform Law Commission determined that the burden of providing the information was not worth the benefit as it was relevant only to registered organizations and the states already had laws precluding the use of duplicate or deceptively similar names.
2001 Version: Required that the financing statement include the debtor's type of organization, jurisdiction and organizational ID number.

2013 Version: Eliminated the requirement for these three pieces of information.

There were also changes to three UCC forms:

National UCC Forms (UCC-1 and UCC-3)

New National Forms that incorporate the revisions to Article 9.

UCC-5 Correction Statement

2001 Version: A debtor may file a UCC-5 Correction Statement when it wishes to add a remark to the public record regarding the financing statement. The Correction Statement has no legal effect.

2013 Version: The Correction Statement is renamed an "Information Statement" and secured parties, as well as debtors, can now file them when they feel clarification is required. They continue to have no legal effect.

Conclusion

To date, 29 states have enacted the 2010 revisions to UCC Article 9, and 6 states plus the District of Columbia have introduced the legislation. The new version has also been endorsed by the American Bar Association.

States That Have Enacted Revised UCC Article 9
Colorado Connecticut Florida Hawaii Indiana Idaho Iowa Kansas Kentucky Louisiana Maryland Michigan Minnesota Nebraska Nevada New Hampshire North Carolina North Dakota Ohio Oregon Puerto Rico Rhode Island South Dakota Tennessee Texas Virginia Washington West Virginia Wisconsin

States that Have Introduced Revised UCC Article 9

Alabama District of Columbia Illinois Massachusetts New Mexico Oklahoma New Mexico Pennsylvania

To view the Revised UCC Article 9 visit: Amendments to Uniform Commercial Code Article 9.

I am interested in this as well. How are you addressing the change with respect to keeping copies of drivers license and fair lending?

I hope it is okay to post this. I am signed up for this free webinar this afternoon. Our training coordinator found this and brought it to my attention. Perhaps this will answer some of our questions:

https://event.on24.com/eventRegistration...cepage=register

Now Arriving: The UCC Article 9 Amendments

"In this webinar, you will learn about:
• the new requirements for sufficiency of debtor names, forms and other relevant UCC provisions
• how to prepare for the new rules
• the transition process
• the legislative outlook"

Correction - it's tomorrow.

So, I missed the webinar. What did you all decide, if anything?

Is there a list of which states have adopted it and which ones haven't?

I just googled it and it said all 50 states have adopted it. I checked my state (IL), which was a straggler and it has, in fact, adopted it.

I would be interested in your source Tesla - I can only find:

States That Have Enacted Revised UCC Article 9
Colorado Connecticut Florida Hawaii Indiana Idaho Iowa Kansas Kentucky Louisiana Maryland Michigan Minnesota Nebraska Nevada New Hampshire North Carolina North Dakota Ohio Oregon Puerto Rico Rhode Island South Dakota Tennessee Texas Virginia Washington West Virginia Wisconsin

States that Have Introduced Revised UCC Article 9

Alabama District of Columbia Illinois Massachusetts New Mexico Oklahoma New Mexico Pennsylvania

Well, like I said, I just did a Google search and then checked my state. Here is link with all the state's enacted UCC.

http://www.law.cornell.edu/uniform/ucc.html

I hope that helps.

I just received an American Bankers Assoc. UCC/Uniform Law News email that shows:

To date, the 2010 Amendments to UCC9 have been enacted in 38 states (including the District of Columbia): AR, CO, CT, DE, DC, FL, GA, HI, ID, IL, IN, IO, KS, KY, LA, MD, MI, MN, MS, MT, NE, NV, NH, NM, NC, ND, OH, OR, RI, SD, TN, TX, UT, VA, WA, WV, WI and WY. Proposed 2010 Amendments to UCC9 are currently pending in 9 states: AK, AZ, CA, ME, MA, MO, NJ, PA and SC. OR has pending legislation that would switch its debtor-name approach from B to A; however, this legislation is reportedly stalled and unlikely to pass this session. Legislation died at adjournment in 3 states in 2013: AL, OK and VT. NY is the only state that has not introduced the 2010 Amendments to UCC9.

Great!Thanks for the info. Teach me to Google! Ha! Ha!

The company that did the webinar Okie Banker told us about has a good UCC resource page (not sure if I'm allowed to link to it here though). They have a nice chart that lists the requirements by state and gives updates on the states with pending legislation.

The company offering that webinar (Corporation Service Company, www.cscglobal.com) has another one coming up on June 11, 1PM EST. [Not an endorsement, although we've used their services for some time.] You can find the link to register by scrolling to the bottom of the home page, then under News & Education, click Web Seminars, Upcoming Live Webinars.

They do have links to their charts. UCC Amendments

Excellent. Thank you