Assignment of Rents
An assignment of rents lets lenders collect tenant income directly if a borrower defaults, providing extra loan security.
September 30, 2025
What is an Assignment of Rents?
An assignment of rents is a legal provision in a mortgage or loan agreement that gives the lender the right to collect rental income directly from tenants if the borrower defaults. It serves as additional security for lenders.
Why an Assignment of Rents Matters in Real Estate
Assignments of rents matter in real estate because they protect lenders by ensuring income from investment properties can be redirected to cover loan payments in the event of borrower default.
Example of an Assignment of Rents in Action
A landlord defaults on their mortgage for an apartment building. The lender enforces the assignment of rents clause, collecting tenant rents directly to apply toward the mortgage balance.
Key Takeaways
- Gives lender rights to collect tenant rents on default.
- Provides additional security for mortgage lenders.
- Common in commercial and investment property loans.
- Triggered when borrower defaults on obligations.
- Helps lenders recover loan payments through rental income.
Related Terms
- Mortgage Default
- Foreclosure
- Receivership
- Security Interest
- Commercial Mortgage
Average and median describe different aspects of the same month’s transactions. Both are affected by the mix of homes sold.
Category averages compare different homes and locations; the gaps are not estimates of the cost to upgrade an otherwise identical property.
The five categories shown account for 5,000 of the board’s 5,057 sales. The remaining 57 transactions were in other housing categories.
Monthly observations are not seasonally adjusted. Active listings count properties available at month-end; they are not construction inventory.
Average and median prices share one dollar axis. These unadjusted transaction measures do not control for changes in the homes sold.
TRREB’s 416/905 categories compare the apartments sold in each area. The difference does not isolate a location premium for equivalent units.
5680 Oak Street in Vancouver and its surrounding context. (MCMP Architects)
Ground-level renderings of the tower proposed for 5680 Oak Street in Vancouver. (MCMP Architects)
