What happens to a financing statement if a debtor moves to a new state?

When a debtor moves to a new state, the effectiveness of a financing statement is impacted by the principles of secured transactions and the Uniform Commercial Code (UCC). The correct understanding is that the financing statement initially filed in the debtor's old state remains effective for a certain period, allowing the secured party to take action.

Specifically, when a debtor changes their location to a new state, the creditor has a four-month window to refile the financing statement in the new state to maintain priority and perfection of the security interest. This period allows the creditor to ensure that their interest is recognized in the new jurisdiction, as the original filing does not automatically transfer or update to the new state's records.

The financing statement does not remain effective indefinitely in the old state, nor does it become void shortly after the debtor's relocation; rather, the four-month allowance provides a practical period to secure the filing in the new location without losing rights. Thus, re-filing within this timeframe is crucial for maintaining the creditor's secured interest.