Stacking
Stacking is when a business takes on multiple secured advances or loans, each perfected by its own UCC filing, layering secured parties on the same collateral.
Stacking is most associated with merchant cash advance, where a merchant takes a second, third, or further advance on top of an existing one. Each funder typically perfects with its own UCC filing, so the public record accumulates multiple secured parties against the same business.
Stacking raises default risk: more fixed daily or weekly obligations compete for the same cash flow, and later positions can find themselves behind earlier ones.
Why it matters for lenders
The first hard evidence of stacking is usually a new UCC-1 from a competing funder. Continuous monitoring of your funded book surfaces it as it happens, rather than weeks later in deteriorating payments.
Related terms
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