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Changes in Debtor’s Name and New Debtor

Changes in Debtor’s Name and New Debtor

Learn how changes to the debtor’s name and business structure can affect a secured transaction.

Transcript

In this lesson, we’ll learn how changes to the debtor’s name and business structure can affect a secured transaction.

I. Name Changes

A debtor might change the name of its business after a secured creditor’s security interests are perfected by filing. This can pose problems.

Remember, a financing statement is ineffective to perfect a security interest unless it sets forth the debtor’s legally correct name. A third party must be able to find the financing statement by searching using the debtor’s...