Legal Definitions - fixture filing

A fixture filing is a specific legal action taken to publicly record a creditor's claim (known as a "security interest") on an item of personal property that is intended to become permanently attached to real estate. This process ensures that even after an item, like a furnace or built-in cabinetry, becomes part of a building or land, the creditor's financial interest in that specific item is publicly known and protected.

When a fixture filing is made, it is recorded in the official real estate records of the county where the property is located. This is crucial because it provides notice to anyone who might later buy the property or lend money against it, making them aware that a specific creditor has a claim on that particular fixture.

Here are some examples to illustrate how a fixture filing works:

• Example 1: Solar Panel Installation

  Imagine a homeowner decides to install a new solar panel system on their roof. They finance the purchase and installation through a specialized solar energy company. The solar panels, once installed, become permanently attached to the house and are considered fixtures. To protect its investment, the solar energy company might make a fixture filing in the county's real estate records. This filing publicly declares that the company has a security interest in the solar panels. If the homeowner were to sell the house before fully paying for the panels, or if they defaulted on their loan, the fixture filing would alert potential buyers or other lenders to the solar company's claim, making it clear that the panels are not entirely free and clear with the property.

• Example 2: Commercial Kitchen Equipment

  A new restaurant owner purchases a custom-built, industrial-grade walk-in freezer and a large commercial oven. These items are specifically designed for the restaurant space, bolted to the floor, and hardwired into the building's electrical and plumbing systems, making them fixtures. The equipment supplier provides financing for these expensive items. To secure their loan, the supplier performs a fixture filing in the real estate records of the property where the restaurant is located. This ensures that if the restaurant business struggles and the property is foreclosed upon or sold, the equipment supplier's claim on the freezer and oven is publicly recognized, potentially allowing them to reclaim the equipment or be paid from the sale proceeds before other general creditors.

• Example 3: Built-in Medical Imaging Equipment

  A medical clinic finances the acquisition and installation of a sophisticated MRI machine. This machine is not just placed in a room; it requires significant structural modifications to the building, specialized electrical wiring, and is permanently integrated into the facility, making it a fixture. The bank that provided the loan for the MRI machine would likely require a fixture filing. This filing would be recorded in the real estate records for the clinic's property. If the clinic were to default on its loan, the bank's fixture filing would provide public notice of its specific claim on the MRI machine, distinguishing it from other assets of the clinic and giving the bank a priority interest in that valuable piece of equipment, even though it's now part of the building.