Continuation Statement: Meaning in a Merchant Cash Advance
A continuation statement is a UCC-3 filed to extend a UCC-1 financing statement for another five years. Without it, a financing statement lapses on its own at the end of five years from the original filing date.
What does continuation statement mean?
A UCC-1 doesn't last forever. Five years after filing, it lapses and loses its place in line unless the secured party files a continuation within the six months before the lapse date. Most merchant cash advances run far shorter than five years, so continuations usually show up on bank loans, equipment deals or long-running credit lines rather than on a typical advance.
Why does continuation statement matter to your business?
A continuation on an old MCA filing is a warning sign. If you paid that advance off, the funder should have terminated the filing, not extended it. It can mean the funder thinks a balance is still owed, or that its records weren't updated. Either way, a new funder will see an active claim and ask about it.
What if you see one on a paid-off advance?
- Gather your zero balance letter and final bank statement showing the last debit.
- Send the secured party a written request for a UCC-3 termination, with those records attached.
- Search again after a few weeks to confirm the change.
How is a lapse different from a termination?
A lapsed filing drops out of line but still appears in some search results as lapsed. A terminated filing shows that the secured party itself ended the claim. When you can get a termination, it gives a cleaner record than waiting for a lapse.
Where will you see it?
In a lien search, listed under the original filing as a continuation with its own date. On bank loan files that run longer than five years.
Which terms are related to continuation statement?
The full list is in the glossary. Owners ask about this in How do I find UCC filings on my business?.
A term on your offer you don't recognize?
Send us the line and we'll tell you what it means. Call 877-FUND-654 with any question. We call you back, usually the same business day, and we always talk with you before we shop your file.