North Carolina Subordination Nondisturbance and Attornment Agreement

• Category: Landlord Tenant - Subordination
• State: Multi-State
• Control #: US-0734-WG
• Format: Word; Rich Text

Description

Subordination Nondisturbance and Attornment Agreement A North Carolina Subordination Nondisturbance and Attornment Agreement (SODA) is a legal document that outlines the relationship between three parties: the lender (often a mortgage lender), the tenant, and the landlord. This agreement ensures that the tenant's leasehold interest is protected in the event of a default or foreclosure by the landlord. Keywords: North Carolina, subordination, nondisturbance, attornment agreement, SODA, lender, tenant, landlord, leasehold interest, default, foreclosure. In North Carolina, there are generally two types of Subordination Nondisturbance and Attornment Agreements: 1. Standard SODA: A standard SODA establishes a priority between the lender's mortgage lien and the tenant's leasehold interest. The agreement subordinates the tenant's lease to the lender's mortgage, meaning that if the landlord defaults on their mortgage, the lender has the right to terminate the lease or take over the property. However, this agreement also includes a "nondisturbance" clause that protects the tenant's rights in the event of foreclosure, ensuring the tenant can continue their occupancy under certain conditions. 2. Recognition SODA: A recognition SODA is a variation of the standard SODA used when a tenant's lease was entered into after the mortgage was recorded. This agreement requires the tenant to recognize the lender as the new landlord if the property is foreclosed upon. The tenant agrees to make payments to the lender and be bound by the terms of the lease, even if the foreclosing lender becomes the new owner. Both types of SODA are vital in commercial real estate transactions. Lenders want to ensure that their mortgage takes precedence over any leasehold interest, providing them with the ability to protect their investment. Tenants, on the other hand, need the reassurance that their rights and occupancy will not be unduly disrupted if the landlord defaults on the mortgage. In summary, a North Carolina Subordination Nondisturbance and Attornment Agreement (SODA) establishes the relationship between the lender, tenant, and landlord in a commercial real estate transaction. It subordinates the tenant's lease to the lender's mortgage lien but includes a nondisturbance clause to protect the tenant's rights in the event of foreclosure. There are two main types of Sodas in North Carolina: standard Sodas and recognition Sodas, each with slightly different provisions depending on the timing of lease inception.

A North Carolina Subordination Nondisturbance and Attornment Agreement (SODA) is a legal document that outlines the relationship between three parties: the lender (often a mortgage lender), the tenant, and the landlord. This agreement ensures that the tenant's leasehold interest is protected in the event of a default or foreclosure by the landlord. Keywords: North Carolina, subordination, nondisturbance, attornment agreement, SODA, lender, tenant, landlord, leasehold interest, default, foreclosure. In North Carolina, there are generally two types of Subordination Nondisturbance and Attornment Agreements: 1. Standard SODA: A standard SODA establishes a priority between the lender's mortgage lien and the tenant's leasehold interest. The agreement subordinates the tenant's lease to the lender's mortgage, meaning that if the landlord defaults on their mortgage, the lender has the right to terminate the lease or take over the property. However, this agreement also includes a "nondisturbance" clause that protects the tenant's rights in the event of foreclosure, ensuring the tenant can continue their occupancy under certain conditions. 2. Recognition SODA: A recognition SODA is a variation of the standard SODA used when a tenant's lease was entered into after the mortgage was recorded. This agreement requires the tenant to recognize the lender as the new landlord if the property is foreclosed upon. The tenant agrees to make payments to the lender and be bound by the terms of the lease, even if the foreclosing lender becomes the new owner. Both types of SODA are vital in commercial real estate transactions. Lenders want to ensure that their mortgage takes precedence over any leasehold interest, providing them with the ability to protect their investment. Tenants, on the other hand, need the reassurance that their rights and occupancy will not be unduly disrupted if the landlord defaults on the mortgage. In summary, a North Carolina Subordination Nondisturbance and Attornment Agreement (SODA) establishes the relationship between the lender, tenant, and landlord in a commercial real estate transaction. It subordinates the tenant's lease to the lender's mortgage lien but includes a nondisturbance clause to protect the tenant's rights in the event of foreclosure. There are two main types of Sodas in North Carolina: standard Sodas and recognition Sodas, each with slightly different provisions depending on the timing of lease inception.