Dec262025
Probate Q&A Series

How can I challenge UCC filings or liens a relative’s mortgage company put on my parents’ assets? – North Carolina

Short Answer

In North Carolina, challenging suspicious UCC filings or recorded liens usually starts by confirming exactly what was filed, where it was filed, and whether there is a real underlying debt or signed security document to support it. When the filings affect a deceased parent’s estate, the personal representative (or sometimes another “interested person”) can use an estate proceeding to demand estate property and push disputed claims into the proper court for a decision. Depending on whether the filing is a UCC financing statement (typically through the Secretary of State) or a real-property lien (typically with the Register of Deeds), the remedy may involve a correction/termination process, a court order clearing title, and sometimes a report to law enforcement for knowingly false filings.

Understanding the Problem

In North Carolina probate, the key question is often: can a family member challenge UCC filings or recorded liens that a relative’s mortgage business placed against a parent’s assets, when those filings appear to change debtor information and could reduce what passes through the parent’s estate. The actor is usually a personal representative handling the estate (executor or administrator) or a family member who claims an interest in the estate. The action is contesting whether the filings are valid encumbrances or improper paperwork that should be removed or declared ineffective. Timing matters because estate administration moves toward paying valid claims and distributing assets, and questionable liens can delay or distort that process.

Apply the Law

North Carolina law treats “UCC filings” and “liens” differently depending on what was filed and where. A UCC financing statement is a public notice filing used to perfect a security interest in personal property under Article 9 of the UCC (Chapter 25). Real-property liens (like deeds of trust, judgment liens, or other recorded encumbrances) generally appear in the county Register of Deeds or with the Clerk of Superior Court, and clearing them often requires a recorded release or a court order. In probate, the personal representative generally has the authority to investigate, protect, and recover property that belongs to the estate and to deal with claims asserted against estate property, including claims described as “secured” by a lien.

Key Requirements

  • Identify the filing and the filing office: Determine whether the problem is (a) a UCC financing statement filed with the North Carolina Secretary of State or (b) a recorded instrument affecting real property filed with a county Register of Deeds or the Clerk of Superior Court.
  • Confirm legal authority and underlying documentation: A valid encumbrance generally traces back to a real debt and a signed document creating the security interest (for example, a promissory note and deed of trust, or a signed security agreement for personal property).
  • Use the correct forum to contest and clear: Probate “estate proceedings” and Superior Court civil actions can be used to recover estate property and to determine adverse claims; clearing title often requires a court order that can be recorded in the public records.

What the Statutes Say

Analysis

Apply the Rule to the Facts: The facts describe UCC filings and changed debtor information in government records, plus alleged “liens” recorded by a relative who owns a mortgage company. That combination suggests there may be (1) an Article 9 UCC filing affecting personal property and (2) recorded real-property instruments that cloud title. Because the concern is a deceased parent’s estate, a personal representative can investigate whether the filings are tied to any real loan documents and, if not, use estate proceedings to recover/secure property and a civil action to clear title or determine adverse claims before distribution.

Process & Timing

  1. Who files: Ideally the personal representative (executor/administrator). In some circumstances, an “interested person” may start an estate proceeding related to recovery of estate property. Where: For estate proceedings, the Office of the Clerk of Superior Court in the county where the estate is administered; for quiet title or other civil claims, Superior Court in the proper county. What: Commonly a verified petition in an estate proceeding asking for recovery of estate property and/or an order addressing disputed claims or encumbrances; and, if needed, a civil complaint to determine adverse claims to real property. When: As soon as the questionable filing is discovered, because it can affect sale, refinancing, and distribution timelines.
  2. Document and verify: Obtain certified copies or official printouts of (a) the UCC financing statement(s) and any amendments and (b) the recorded lien documents and indexing history. Compare debtor names, addresses, collateral descriptions, and signatures to known estate records.
  3. Demand correction and pursue court relief: If the filer cannot produce signed loan/security documents supporting the encumbrance, counsel can send a written demand for termination/release and simultaneously prepare court filings (estate proceeding and/or Superior Court action). If the court enters an order declaring a recorded lien invalid, record the certified order so the public records reflect the court’s ruling.

Exceptions & Pitfalls

  • UCC filings vs. real-property filings: The “false lien” statute’s denial procedure does not apply to Article 9 UCC filings, so the strategy must match the filing type and office involved.
  • Standing and authority: A beneficiary/heir may have limits on acting for the estate. When the asset is an estate asset, the personal representative typically has the clearest authority to demand documents, sue to recover property, and manage claims.
  • Clouded title can stop transactions: Even an invalid filing can block a sale or refinance until it is released or a court order is recorded. Waiting can increase costs and delay the estate.
  • Confusing “secured claim” priority with validity: In estate administration, secured claims can receive priority only if there is a valid lien on specific property. A document labeled “lien” is not automatically valid.
  • Service and notice mistakes: Estate proceedings and civil actions require proper service and notice to affected parties. Missing a necessary party can prevent a clean, recordable order.

Conclusion

In North Carolina, challenging questionable UCC filings or liens against a parent’s estate starts with identifying the exact filing (UCC vs. recorded real-property instrument), demanding proof of the underlying signed security documents, and using the proper forum to clear the record. A personal representative can use estate proceedings to recover and protect estate property and can pursue a Superior Court action (such as quiet title) when a recorded instrument clouds title. If a false lien is denied for recording, the party seeking recording must file the required special proceeding within 10 business days.

Talk to a Probate Attorney

If a relative’s business recorded UCC filings or liens that appear to divert estate assets, our firm has experienced attorneys who can help sort out what was filed, who has authority to act for the estate, and which court process can clear the records. Call us today at (919) 341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.

Category: Probate Q&A Series

Author: jpierce

Attorney Jared Pierce is the founder of Pierce Law Group in Raleigh, North Carolina, a firm he established with a dedicated focus on probate administration and estate planning across North Carolina. Born and raised in the Republic of South Africa, Jared moved to Durham with his family in 2001, bringing with him a rich cultural background and a distinctive accent that often serves as a conversation starter.