Blanket lien

A blanket lien, sometimes called a blanket UCC filing, gives a lender a security interest in a broad pool of business assets at once instead of one named piece of collateral. The covered assets can include things like equipment, inventory, accounts receivable, and cash. Lenders record a blanket lien through a UCC filing, and it lets them secure financing without tying it to a single asset. This is common with working capital and line of credit products where the collateral is the general health of the business rather than one item.

A blanket lien protects the lender, but it can limit your flexibility because so much of the business is pledged at the same time. If you later seek additional financing, a new lender may hesitate or ask the first lender to subordinate its claim, since the existing blanket lien sits ahead of theirs. Before agreeing, read exactly which assets are covered and whether the lien can be narrowed or released as you pay down the balance. After payoff, confirm the lender files a termination so the broad claim is cleared from your record.