Credit improvement using UCC filings:
Any document that is filed with your state is considered a public filing. That document is now public knowledge. Anyone can search through these public records and find these documents/information.
Credit bureaus are connected to a public filing database that updates periodically (varying by state). They automatically receive all liens and bankruptcy information after it is filed at the county state or federal level. Ever wonder how certain car salespeople or certain property managers manage to get things to appear on your credit report.
UCC stands for Uniform Commercial code. UCC filings is a VERY powerful tool in improving both business and personal credit. The amazing thing is that most people do not know about this technique. Well. most people do not even know that you do NOT need a lawyer to incorporate a business. Lawyers might charge you up to 4 times more than if you incorporate yourself. There are many such examples, lawyers being paid for something that can easily be done yourself. You will be amazed how easy some of these things are.Moreover the purpose of UCC filings is NOT to build credit – the credit building part is a by-product. If you really think about it, most credit building methods are just that.
What you have to understand about UCC filings is that they are not new. Public filings, in one shape or form, have always been around. UCC filing basically shows the public that a collateral is being held between parties for an agreement between the parties. So if I get into a monetary agreement with you I can file a UCC to give details of the collateral that will secure that agreement.. Of course when the UCC is filed it will be public knowledge and any good data collection agency or credit bureau will pick that up. That is when the “fun” starts.
For now, long story made short, UCC is a form of public filing that will help you develop both your business and personal credit. As the collateral is released and the UCC eventually terminated your credit will improve. This is true for both personal and business credit. The effect is similar to getting a bank loan and paying it off.
Personally I think that this method will work for another 1 to 2 years max. I believe that this “loop-hole” (for the lack of a better word) will eventually close. Remember at present anyone can file a UCC and the requirements are not that hard to meet. This is very similar to when people could improve their credit by becoming authorized users of another persons credit card. Even if they had bad credit a mere phone call would make them authorize users. I remember witnessing a person build a 5 year credit history by getting his friend to make him an authorized user on one of his cards. Of course the “trick” became common practice and now that method is almost obsolete. You can still become an authorized user BUT it does not effect your credit the way it used to. There is a good chance that UCC filings would follow the same pattern (for credit repair that is) but for now I believe that any intelligent person should make full use of this method. Knowing the law and than using the law is the “way” of the corporation. Both personal and business credit can be improved using UCC filings.
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