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Drafting and Enforcing Assignments of Rent: Collateral vs. Absolute Assignments, Receiverships, Bankruptcy Issues

Best Practices in Drafting an Assignment of Rents and Leases

Recording of a 90-minute premium CLE video webinar with Q&A

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Conducted on Tuesday, February 20, 2024

Recorded event now available

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This CLE webinar will focus upon the drafting and enforcement of assignments of rent in state and bankruptcy courts and how parties to assignments of rent in a commercial mortgage transaction can protect their rights.


State and federal courts, including bankruptcy courts, have struggled with issues involving the creation of an enforceable assignment of rents and the exercise by a mortgagee, or lender, of its rights to collect and retain rents thereunder. The issues are critical when the mortgagor, or borrower, is the subject of a bankruptcy case.

Over time, two types of assignments of rent have developed. Under a collateral assignment, a security interest in favor of the lender is created and the borrower retains title to the rents and collects rents until a triggering event or action occurs.

Under an absolute assignment, title to the rents or leases passes to the lender at the time the assignment is made and the lender allows the borrower to collect rents, usually pursuant to a license, until a triggering event or action occurs.

Whether the lender or the borrower owns the rents is critical, particularly in the event of a borrower’s bankruptcy, since ownership will control whether the rents are property of a debtor’s estate constituting cash collateral that can be used by the debtor.

The creation and enforcement of assignments of rent is governed by state law (with the overlay of bankruptcy laws such as the automatic stay), and different states have adopted different laws. While the Uniform Assignment of Rents Act was adopted nearly 20 years ago, very few states have adopted it.

Listen as our authoritative panel discusses the enforcement of assignments of rents, including an introduction into various laws, practices and recent caselaw.



  1. Collateral vs. Absolute Assignments of Rent
    1. A distinction without a difference?
  2. Bankruptcy Considerations for Assignments of Rent
    1. Chapter 11 versus Chapter 7
    2. Property of the Estate and Automatic Stay Issues
    3. Cash Collateral and Cash Management Concerns
    4. Debtor vs. Lender Approaches
  3. Differing State Laws on Assignments of Rent
    1. Importance of State Law
    2. Recent Decisions (including In re Town Center Flats (6th. Cir. 2017))
    3. Conflicts of Law
  4. A Trend Toward Uniformity? The Uniform Assignment of Rents Act
    1. State Adoption
    2. Enforcement Mechanisms
  5. Special Situations & Final Considerations
    1. Receiverships and Assignments for the Benefit of Creditors
    2. Drafting Recommendations & Panel Tips
    3. Trends


The panel will review these and other vital issues:

  • What is the significance of an assignment of rents in a commercial mortgage transaction, and why is it sometimes a separate document from the mortgage?
  • How and when is an assignment of rents perfected, and what are the implications for enforcement?
  • What is collateral assignment as opposed to an absolute assignment, and why might a lender prefer one over the other?
  • How does the asset class impact the efficacy of an assignment of rents and the practical viability of enforcement mechanisms?
  • How do pre-petition enforcement efforts affect the borrower's access to property revenues during the pendency of a bankruptcy?


Lesser, Scott
Scott R. Lesser

Miller, Canfield, Paddock and Stone

As a leader on the firm’s highly experienced Commercial Real Estate Workout Team, Mr. Lesser uses his knowledge...  |  Read More

Reperowitz, Deborah
Deborah A. Reperowitz

Senior Counsel
Stradley Ronon Stevens & Young

Ms. Reperowitz is a nationally recognized bankruptcy and commercial litigation attorney and mediator. Debbie has been a...  |  Read More

Webb, A.J.
A.J. Webb

Frost Brown Todd

Mr. Webb counsels companies facing varying degrees of financial uncertainty and distress, working to proactively...  |  Read More

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