medium · Asset-Backed Securities asset-nuances
In the event of a lessee default in an operating lease ABS, why is repossession typically faster than in a secured auto loan transaction?
- Equipment leases must include a recovery-speed clause mandated by federal regulators.
- The lessor (trust) already retains legal title to the equipment in a true lease structure.
- Commercial equipment lessees are entirely excluded from automatic bankruptcy stay protections.
- Federal maritime statutes permit lessors to use self-help repossession on any commercial equipment.
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