What is UCC Article 9 in Plain English

UCC Article 9 is a set of rules that lets one business secure a claim to another business's money.

Here's how it works. When a business sells its daily revenue stream to a funding company, that company files a public document called a UCC-1 financing statement. This filing tells everyone that the funding company has a legal claim to that revenue. The purchaser is the funding company. The seller is the business owner. Once filed on the Secretary of State website, the UCC-1 creates what's called a perfected security interest.

That means the funding company's claim is official and protected by law. Why does this matter? Because it separates the funding company's claim from other debts the business might have. If the business fails, the funding company gets paid first from that revenue stream. It's a real property right, filed on public record.