Floating lien

Definition of Floating lien

A security interest retained in collateral even when the collateral changes in character, classification, or location. An inventory loan in which the lender receives a security interest or general claim on all of a company’s inventory. Security interest under which borrower pledges security for present and future advances. John Miller Supply, Inc. v. Western State Bank, 55 Wis.2d 385, 199 N.W.2d 161, 163. Such security is not only in inventory or accounts of the debtor in existence at the time of the original loan, but also in his after-acquired inventoiy or accounts. U.C.C. § 9-204(4).

That's the definition of Floating lien in Black's Law Dictionary 6th Edition. Courtesy of Cekhukum.com.