Represents a general and comprehensive revision of the state's prior laws applicable to commercial transactions. The Code provides a uniform and easily available set of rules for the conduct of commercial transactions responsive to modern business conditions and needs. In short, the purpose was to simplify, clarify and modernize the law(s) governing commercial transactions; to make uniform the law among the various jurisdictions, and to permit the continued expansion of commercial practices through custom, usage, and agreement of the parties involved.
The Uniform Commercial Code Bureau files and maintains records on financial obligations (including IRS liens) incurred by individuals (in business as a sole proprietor), business entities and corporations. This information is important to any business or financial institution contemplating entering into a lien transaction as the secured party (the party providing funds or financing collateral). Knowing the current financial status of the debtor party (the potential borrower) before extending credit is crucial, and it is the number of active, existing liens already in effect for that particular debtor party that most interests the potential secured party. As a prerequisite for entering into a lien relationship, many secured parties first research a debtor name to ascertain their credit worthiness and then demand a lien filing in regard to the actual, current transaction. Secured parties routinely include banks, commercial businesses (appliances, autos, boats), and sole proprietors.