§ 714.3. Must you own the leased property in an indirect leasing arrangement?
162 words·~1 min read·
/us/cfr/t12/s§ 714.3·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
You do not have to own the leased property in an indirect leasing arrangement if:
(a)You obtain a full assignment of the lease. A full assignment is the assignment of all the rights, interests, obligations, and title in a lease to you, that is, you become the owner of the lease;
(b)You are named as the sole lienholder of the leased property;
(c)You receive a security agreement, signed by the leasing company, granting you a sole lien in the leased property and the right to take possession and dispose of the leased property in the event of a default by the lessee, a default in the leasing company's obligations to you, or a material adverse change in the leasing company's financial condition; and
(d)You take all necessary steps to record and perfect your security interest in the leased property. Your state's Commercial Code may treat the automobiles as inventory, and require a filing with the Secretary of State.