Collin Texas Subordination, Non-Disturbance, and Attornment Agreement of a Lease regarding a Commercial Loan

• Category: Loans and Lending
• State: Multi-State
• County: Collin
• Control #: US-1176BG
• Format: Word; Rich Text

Description

The main purpose of this document is to subordinate the lease to the deed of trust or mortgage (if applicable), and have the tenant agree to be bound by the lease to a new owner in the event of foreclosure. Collin Texas Subordination, Non-Disturbance, and Attornment Agreement (SODA) is a legal document specific to commercial real estate leases in Collin County, Texas. It outlines the relationship between the landlord, the tenant, and the lender in the event of a commercial loan on the leased property. SODA agreements are crucial in protecting the rights and interests of all parties involved. In a general Collin Texas SODA, the terms and conditions highlight three key components: subordination, non-disturbance, and attornment. 1. Subordination: This component refers to the agreement between the tenant and the lender, where the tenant acknowledges that their leasehold interest is subordinate to the lender's security interest or mortgage. In other words, in the event of a default or foreclosure, the lender's rights take precedence over the tenant's rights. 2. Non-Disturbance: The non-disturbance clause assures the tenant that if the landlord defaults on the commercial loan or faces foreclosure, the tenant's occupancy rights will be protected by the lender. The tenant agrees to continue making rent payments directly to the lender, ensuring uninterrupted use and enjoyment of the premises. 3. Attornment: Attornment refers to the tenant's agreement to recognize and acknowledge the lender or any subsequent owner as their new landlord in the event of a change in ownership due to foreclosure or assignment of the lease. This provision allows the lender to step into the landlord's shoes, ensuring lease continuity for the tenant. It's essential to note that specific Collin Texas SODA agreements may have variations based on the unique terms negotiated by the parties. Some additional types or modifications of SODA agreements include: — Collateral Assignment: In certain cases, the lender may require the tenant to assign their rights or interests under the lease as additional collateral for the loan. This provides an extra layer of security for the lender but may impact the tenant's ability to transfer or assign their leasehold interest. — Estoppel Certificate: An estoppel certificate is a separate document often attached to the Collin Texas SODA. It requires the tenant to confirm and provide critical information regarding the lease terms, any defaults, or agreements made with the landlord. These certificates help future lenders or potential buyers understand the tenant's rights and obligations under the lease. Collin Texas SODA agreements in the context of commercial loans are essential in providing assurance and protection for both the landlord and the tenant. These agreements help establish a clear framework for leasehold financing and outline the actions and responsibilities of each party involved, ensuring a smooth transaction and minimizing disruptions in the event of default or foreclosure.

Collin Texas Subordination, Non-Disturbance, and Attornment Agreement (SODA) is a legal document specific to commercial real estate leases in Collin County, Texas. It outlines the relationship between the landlord, the tenant, and the lender in the event of a commercial loan on the leased property. SODA agreements are crucial in protecting the rights and interests of all parties involved. In a general Collin Texas SODA, the terms and conditions highlight three key components: subordination, non-disturbance, and attornment. 1. Subordination: This component refers to the agreement between the tenant and the lender, where the tenant acknowledges that their leasehold interest is subordinate to the lender's security interest or mortgage. In other words, in the event of a default or foreclosure, the lender's rights take precedence over the tenant's rights. 2. Non-Disturbance: The non-disturbance clause assures the tenant that if the landlord defaults on the commercial loan or faces foreclosure, the tenant's occupancy rights will be protected by the lender. The tenant agrees to continue making rent payments directly to the lender, ensuring uninterrupted use and enjoyment of the premises. 3. Attornment: Attornment refers to the tenant's agreement to recognize and acknowledge the lender or any subsequent owner as their new landlord in the event of a change in ownership due to foreclosure or assignment of the lease. This provision allows the lender to step into the landlord's shoes, ensuring lease continuity for the tenant. It's essential to note that specific Collin Texas SODA agreements may have variations based on the unique terms negotiated by the parties. Some additional types or modifications of SODA agreements include: — Collateral Assignment: In certain cases, the lender may require the tenant to assign their rights or interests under the lease as additional collateral for the loan. This provides an extra layer of security for the lender but may impact the tenant's ability to transfer or assign their leasehold interest. — Estoppel Certificate: An estoppel certificate is a separate document often attached to the Collin Texas SODA. It requires the tenant to confirm and provide critical information regarding the lease terms, any defaults, or agreements made with the landlord. These certificates help future lenders or potential buyers understand the tenant's rights and obligations under the lease. Collin Texas SODA agreements in the context of commercial loans are essential in providing assurance and protection for both the landlord and the tenant. These agreements help establish a clear framework for leasehold financing and outline the actions and responsibilities of each party involved, ensuring a smooth transaction and minimizing disruptions in the event of default or foreclosure.