The initial process revolves around the location of the debtor and the location(s) of the collateral, and in practical effect is a mirror image of the considerations used in determining where filings were required to be made initially. For example, a UCC-1 fixture filing is generally recorded in the filing office responsible for maintaining real estate records where the property in question is located, while a UCC-1 affecting personal property relating to a registered organization is generally recorded at the central filing office (e.g., the Secretary of State) in the domestic state of organization. In the case of personal property where the debtor is an individual, the filing is generally recorded at the central file office (e.g., Secretary of State) at the state of primary residence. There are specific rules that relate to the filing of federal tax liens, state tax liens, etc. which must be reviewed prior to identifying the proper locations to search.
After identifying potential search locations, careful attention must be paid to determining the names of the debtors that are to be searched. Again, this will vary based upon the type of lien being searched. While rules for UCC liens are set forth in section 5 of Article 9, other lien types follow different rules. Because it is fairly common for non-consensual, non-UCC liens to contain name variations that would not comply with Article 9 debtor name requirements, a broad-based search might be beneficial, as these searches can pick up a number of name variations.
Also, parties conducting searches must decide whether they prefer to limit their searches only to UCC liens or to conduct searches for the related suite of liens that can be found in the same filing offices. Many parties conducting lien searches routinely search for federal tax liens, state tax liens, and judgment liens in addition to both centrally and locally filed UCC liens. This is often referred to as the state and four-part search
The value of the four-part search
Further, tax and judgment liens ordinarily apply to the same types of property covered by UCC liens. Where a previously existing tax or judgment lien is on file, searching only the UCC records easily could create the false impression that the intended collateral in a transaction is unencumbered. This often has led to serious and unintended consequences.
Lastly, like UCC liens, tax and judgment liens apply to all entities and individuals. Unlike many specialty type liens that apply only to certain kinds of entities engaged in particular business activities, tax and judgment liens apply universally. Consequently, searching for them always results in useful information.