Security in real estate finance transactions

This Overview is a guide to the Banking & Finance content within the Security in real estate finance transactions subtopic, with links to the appropriate materials.

Real estate finance is a type of secured lending. Some of the reasons for taking security in a real estate finance transaction reflect the main advantages of taking security in any commercial finance transaction (see Practice Note: Difference between security and quasi-security).

Security in real estate finance transactions is particularly important because the borrower is usually a special purpose vehicle (SPV) (also known as a 'special purpose company' or SPC) which is set up specifically for the proposed transaction (ie to purchase or purchase and develop a property). This means that the borrower will have no history of operations and its only assets will be those related to the property and, if applicable, its development.

As a result of the SPV structure, the credit risk associated with the borrower is usually of less importance to lenders in real estate finance transactions than in a straightforward corporate loan transaction. A comprehensive security package is one way for the borrower

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

TAKE A FREE TRIAL

Latest Banking & Finance News

ISDA publishes review on MIFIR's post-trade transparency rules

The International Swaps and Derivatives Association (ISDA) has released its perspective on the post-trade transparency rules implemented by the Markets in Financial Instruments Regulation (MIFIR) which came into effect in March 2024; and specifically encompasses the revised regulations surrounding interest rate derivatives, index credit default swaps, and securitised derivatives.

ISDA publishes report on MIFIR compliance requirements for CDS reporting

The International Swaps and Derivatives Association (ISDA) has released a document outlining a strategy for post-trade transparency under the updated Markets in Financial Instruments Regulation (MIFIR) for reporting single-name credit default swaps (CDS) linked to globally significant banks, facilitating substantial transparency and practical implementation. This publication is part of ISDA's continuous efforts to assist the industry in adapting to the changing regulatory environment, especially regarding derivatives transparency and compliance requirements under the MIFIR.

ICMA releases new reference guide for DLT based debt securities

The International Capital Market Association (ICMA) has published a new comprehensive reference guide, providing practical insights into the duration period of debt securities based on distributed ledger technology (DLT). The guide represents a joint initiative across the bond market value chain and addresses over 50 vital questions, seeking to aid market practitioners in both traditional and digital asset roles while aiming to boost liquidity in DLT-based bonds by highlighting compatibility; cash on ledger; legal and regulatory aspects and; to enhance standardisation in particularly the tokenised debt security sector.

GFXC finalises three-year review of FX Global Code

The Global Foreign Exchange Committee (GFXC) has completed its three-year review of the FX Global Code, verifying final amendments to enhance guidance on FX settlement risk and bolster transparency in certain FX transactions. The modified Code, together with an overview document detailing the review outcomes and feedback responses, is set to be released in January of next year.

View Banking & Finance by content type :

News