Follow Us

Law.com Subscribers SAVE 30%

Call 855-808-4530 or email GroupSales@alm.com to receive your discount on a new subscription.

Bankruptcy Commercial Litigation Litigation

'Secured Lender's Corner:' Protecting the Secured Lender Before a Mortgagor or Lessee Files Bankruptcy

It is important for a secured lender to protect itself when entering a transaction with a borrower or lessee to avoid a total loss if the borrower or lessee files a bankruptcy petition or if the leased equipment is damaged, missing or both.

X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Earlier this year, the United States Court of Appeals for the Fifth Circuit explored the application of the equitable lien doctrine after a secured equipment lender sought to recover directly from its borrower’s insurance company once the borrower filed a Voluntary Petition under Chapter 11. The court affirmed the district court’s denial of relief to the lender. This reinforces the importance that a secured lender protect itself when entering a transaction with a borrower or lessee to avoid a total loss if the borrower or lessee files a bankruptcy petition or if the leased equipment is damaged, missing or both.

Read These Next