• Refinancing the Borrower through an Assignment and Assumption: When, Why, and How
  • October 19, 2017
  • With today’s competitive lending landscape, an assignment and assumption agreement can be a successful alternative deal-documentation strategy for secured lenders who want to close a refinancing as quickly and efficiently as possible, especially when there are uncooperative third parties involved. There are many factors to consider before a secured lender can determine if an assignment and assumption of an existing lender's loan and loan documents is the right approach.

    In a two-part article, Part 1 of which appeared in the May 2017 edition of The Secured Lender. Otterbourg’s Jason Miller discusses how thorough diligence, advice of counsel and an analysis of these factors can help lenders in seizing opportunities to use an assignment Part 1 outlines key points that a lender should consider when assessing whether this strategy is appropriate under the circumstances. Part 1 can be found here.

    Part 2 of the article, appearing in the October 2017 edition of The Secured Lender, builds upon the discussion in Part 1. It focuses on the technical aspects and specific provisions usually found in an assignment and assumption agreement and highlights how the strategy compares with a typical payoff scenario. Part 2 can be found here.