A blanket lien is a UCC-1 financing statement filed by a lender that encumbers all present and future business assets — cash, receivables, inventory, equipment, and intellectual property — as collateral. Filed with the state Secretary of State. Public record, visible to all subsequent lenders, and can block future financing until released.
A blanket lien gives a lender a perfected security interest in every business asset a company owns or will own in the future, under UCC Article 9 (https://www.law.cornell.edu/ucc/9/9-102). Unlike a specific UCC (which covers named collateral such as a piece of equipment), a blanket lien covers all business assets — including assets the business hasn't yet acquired. MCA funders and many online alternative lenders file blanket UCCs as standard practice at the time of funding. The filing is public record, discoverable on any state UCC search within 24–48 hours. Any subsequent lender who runs a UCC search — which every bank, SBA lender, and most alternative lenders do as part of underwriting — will see the existing blanket lien and take it into account. The practical impact: a blanket UCC lien from an existing funder prevents most banks and SBA lenders from taking a senior secured position. SBA SOPs require that the SBA lender hold first-lien position on all collateral — an existing blanket lien must be released or subordinated (with a subordination agreement from the existing funder) before SBA funding can proceed. Many bank term-loan programs have the same requirement. Blanket liens from paid-off obligations persist until the funder files a UCC-3 Termination. These 'ghost UCCs' are a common cause of unexplained financing blocks. Verify UCC termination on your state's Secretary of State search portal after every payoff. The lien is active for 5 years from filing under UCC §9-515; the funder must file a UCC-3 Continuation to extend. See also: ucc-lien (the general UCC lien glossary entry).
A specific UCC covers named collateral only — e.g., a piece of equipment by serial number. A blanket UCC covers all business assets, present and future. MCA funders and many online lenders default to blanket UCCs because they're the broadest protection. Banks and SBA lenders often file specific UCCs covering real estate, equipment, or named assets.
From some lenders, yes — a second-position lender can fund if they're comfortable behind the senior blanket lien. However, most banks and SBA lenders require senior lien position and won't fund over an existing blanket lien without a signed subordination agreement from the first lender. The subordination agreement is negotiable but the first lender must agree to it.