1.  Should the Master Tenant Security Agreement (HUD-92340-ORCF) be recorded? I’m getting pushback from lender’s counsel stating that security agreements are typically not recorded and that the inclusion of the “return to” address block on the front page is a scrivener’s error. It is my understanding that the HUD form of master tenant security agreement includes an assignment of leases and rents in addition to the typical security interest granted in the personalty and therefore should be recorded unlike the typical security agreement. Is this a correct assumption? (4/11/16)

 

 

 

 

 

Yes, the Master Tenant Security Agreement (MTSA) should be recorded.  Unlike the Operator’s Security Agreement (HUD-92323-ORCF), which requires the operator to execute and record an Assignment of Leases and Rents as a separate document, the master tenant’s assignment of leases and rents is contained in the body of the MTSA.  Recording the MTSA, along with the Operator’s Assignment of Leases and Rents, is thus required to ensure that all assignments of leases and rents in master lease transactions appear in the local land records.