Jan22026
Probate Q&A Series

What is the difference between a deed of trust on a home and a UCC filing that shows up in land records? – North Carolina

Short Answer

In North Carolina, a deed of trust is the standard lien used to secure a home loan and it directly encumbers the real estate. A UCC filing usually relates to personal property (like business equipment, accounts, or fixtures) and is mainly a public notice that a creditor claims a security interest. Sometimes a UCC-related document appears in county land records, but that does not automatically mean there is a mortgage on the home. The practical difference is what property is collateral and what enforcement process applies.

Understanding the Problem

In North Carolina probate and estate administration, confusion often comes up when a title search shows both (1) a deed of trust recorded against a home and (2) a UCC filing or UCC-related document indexed in the county land records. The decision point is whether the recorded item creates a lien on the real estate itself (like a deed of trust) or instead gives notice of a creditor’s claim against personal property connected to the owner or a business (like many UCC filings). This distinction matters when identifying what must be paid off at closing, what affects marketable title, and what may need to be addressed during estate administration.

Apply the Law

North Carolina treats a deed of trust as a recorded real-estate security instrument: it is designed to encumber land and improvements and is recorded in the county where the land is located. A UCC filing is generally a notice system for security interests in personal property under commercial law; it may be filed with the Secretary of State and, in some situations, a related record can also appear in county land records (for example, when the collateral involves fixtures or a leasehold interest). In probate, the key practical question is whether the document is a lien that must be handled as part of clearing title to real property, or a personal-property security interest that may be handled differently.

Key Requirements

  • Type of collateral: A deed of trust targets real property (the home/land). A UCC filing usually targets personal property (movable property, business assets, or sometimes fixtures).
  • Where it is recorded: A deed of trust must be recorded with the Register of Deeds in the county where the land lies to be effective against the land in that county. A UCC filing is commonly made through the Secretary of State’s UCC system, though certain real-estate-adjacent filings can also show up in county records.
  • Who is involved and how it is enforced: A deed of trust uses a trustee structure and is enforced through foreclosure procedures tied to the real estate. A UCC security interest is enforced through commercial remedies against the collateral (often repossession or disposition of personal property), not a standard real-estate foreclosure.

What the Statutes Say

Analysis

Apply the Rule to the Facts: The scenario involves a UCC filing “showing up in land records” alongside a deed of trust on a home. Under North Carolina practice, the deed of trust is the document that typically creates a lien on the real estate and is recorded in the county land records where the property sits. A UCC filing, by contrast, often signals a creditor’s interest in personal property and may appear in local land records for indexing reasons or because the collateral has a real-estate connection (such as fixtures), but it does not automatically function like a mortgage on the home. The correct next step is to identify what the UCC document actually covers and whether it claims an interest in fixtures or other property tied to the land.

Process & Timing

  1. Who checks: The personal representative, heir, or closing attorney. Where: The Register of Deeds in the North Carolina county where the land is located, and (for many UCC records) the North Carolina Secretary of State UCC database. What: Obtain copies of the recorded deed of trust and the UCC-related document as recorded/indexed, then compare the debtor name, secured party, and collateral description. When: As early as possible in estate administration or before listing/closing, because liens and security interests can affect title and payoff planning.
  2. Next step: Determine whether the UCC record is (a) only a personal-property filing unrelated to the home, (b) a fixture-related claim that could affect the real estate, or (c) a filing that was recorded for notice but has expired or was terminated (which may require obtaining and recording a termination or release, depending on what was filed).
  3. Final step: If the deed of trust is still owed, arrange for payoff and a recorded satisfaction/release through the secured creditor. If the UCC-related record clouds title or claims fixtures, address it through the secured party (often by obtaining a termination or release) so the land records reflect clear status for the transaction or estate distribution.

Exceptions & Pitfalls

  • Fixtures vs. personal property: Some UCC filings can relate to “fixtures” (items attached to real estate). If the collateral description includes fixtures, it can create a real-world title issue even though it is not a deed of trust.
  • Name matching problems: UCC records are indexed by debtor name. Similar names can cause a filing to appear “connected” to a property owner when it actually relates to a different person or entity.
  • Assuming the trustee must be involved: Many non-foreclosure disputes about a deed of trust focus on the secured creditor rather than the trustee, and North Carolina law limits when the trustee is a proper party outside foreclosure contexts.
  • Probate administration timing: When real property must be used to pay estate debts, the personal representative generally needs proper authority and should treat liens as being paid in priority from sale proceeds before other claims are paid.
  • County-to-county practice differences: Recording and indexing practices can vary, and estate real-property procedures can vary by county, so confirming local requirements with the Clerk of Superior Court and Register of Deeds matters.

Conclusion

In North Carolina, a deed of trust is the recorded instrument that typically creates a lien on a home and is recorded in the county where the land is located. A UCC filing usually gives notice of a security interest in personal property and may appear in land records for limited reasons, but it does not automatically operate like a mortgage on the home. The key next step is to obtain and review the recorded documents and confirm the collateral description, then request a payoff and recorded satisfaction or termination as needed before any sale or distribution.

Talk to a Probate Attorney

If a deed of trust and a UCC filing are both showing up in the land records and it is unclear what must be paid off or released to clear title, our firm has experienced attorneys who can help explain what the filings mean and what timelines apply in an estate or closing. 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.