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Landlord Lien Waiver
Practical Law Glossary Item 0-503-1058 (Approx. 3 pages)
Glossary
Landlord Lien Waiver
In the context of a financing, the waiver of a landlord's lien rights to its tenant's personal property that is located at the leased premises.
When a lender uses a borrower's non-real estate related property as collateral for a loan, including inventory, equipment, and personal property, the lender often seeks a waiver from the landlord of its right to lien the borrower's non-real estate related property located in the leased premises.
Due to the difference in landlord lien rights among various states, the requirements for landlord lien waivers change on a state-specific basis. However, landlord lien waivers generally include:
- A waiver of the landlord's lien rights over its tenant's property located at the leased premises. However, sometimes landlords agree to subordinate their lien rights rather than waive them.
- Access rights to the leased premises for the lender to remove or auction off (whether through public or private sale) the collateral if necessary.
- Notice and cure rights for any borrower default under the lease.
- The lender's permitted use and a daily rental payment for its use and occupancy of the leased premises.
- The lender's restoration obligations for damage to the leased premises caused during the removal of the collateral.
For additional guidance, see Standard Document, Landlord Lien Waiver and Collateral Access Agreement.