247SimpleTests
Real Estate · License Law Violations and Discipline

What is 'subordination, non-disturbance, and attornment' (SNDA) in commercial real estate leasing?

Reviewed by Jordan Morley, Editorial Lead at 247SimpleTests. Written by the 247SimpleTests Editorial Team from the official source material cited on every question.

Correct answer

A three-part agreement between lender, landlord, and tenant: SUBORDINATION (tenant's lease is subordinate to the lender's mortgage); NON-DISTURBANCE (lender agrees not to disturb the tenant's possession if they foreclose, as long as the tenant is not in default); ATTORNMENT (tenant agrees to recognize the new owner — including the lender after foreclosure — as their landlord)

  1. A A zoning variance application
  2. B A title insurance endorsement
  3. C An addendum for residential purchases
  4. D A three-part agreement between lender, landlord, and tenant: SUBORDINATION (tenant's lease is subordinate to the lender's mortgage); NON-DISTURBANCE (lender agrees not to disturb the tenant's possession if they foreclose, as long as the tenant is not in default); ATTORNMENT (tenant agrees to recognize the new owner — including the lender after foreclosure — as their landlord)

Why this is the answer

SNDA AGREEMENTS are standard in commercial real estate financing and leasing. Why each provision matters:

Subordination: The lender's mortgage takes priority over the tenant's lease — if the building is foreclosed, the senior position matters for property rights. Without subordination, a lease that predates the mortgage might survive foreclosure.

Non-disturbance: Protects the tenant — they don't want to lose their space because the landlord defaulted on their loan. The lender agrees to honour the lease even after foreclosure.

Attornment: The tenant agrees to recognize the new owner (foreclosing lender or purchaser at foreclosure) as their landlord and pay rent to them. Without SNDA, tenant and lender are in a position of uncertainty after foreclosure. Commercial tenants with significant improvements or long-term leases almost always require SNDAs before signing.

Source: Real Estate State Exam, SNDA Agreement

Practice more questions

This question is from our Real Estate License Practice Tests practice test. Take the full practice test to test your knowledge across all License Law Violations and Discipline and other topics.

Take the Broker (State Law) practice test →

About this topic: License Law Violations and Discipline

License law violations and discipline cover the grounds for discipline, the complaint and hearing process, penalties (fines, suspension, revocation), and the recovery fund. This is one of 20 Broker (State Law) questions on license law violations and discipline, each with a full explanation on a single study page.

New to this exam? Our Real Estate exam guide explains the format, scoring, and how to prepare.

Related questions

License Law Violations and Discipline

A licensed salesperson knowingly pays an unlicensed person a referral fee for sending a buyer to her. Under typical state law, who can be disciplined?

 License Law Violations and Discipline

A broker submits false continuing education records to renew their license. This is most likely considered:

 License Law Violations and Discipline

Mishandling a client's earnest money funds — including failing to deposit timely, commingling with personal funds, or using funds for unauthorized purposes — is typically considered:

 License Law Violations and Discipline

A broker is convicted of fraud unrelated to their real estate business. Under typical state license law, what is the most likely consequence?

State-specific guides

Need information for your state? Our state guides cover local requirements, fees, and what to expect on exam day.

California Texas Florida New York Pennsylvania Illinois Ohio Georgia

Recommended study materials

Study guide

Real Estate License Exam Prep 3rd Ed. (Performance Programs)

National and state portion prep, contracts, agency law, fair housing, and math — the industry standard.

Check Price → Study guide

Modern Real Estate Practice 21st Ed. (Dearborn)

The most widely used real estate principles textbook: principles, law, practice, and math in one volume.

Check Price → Study guide

Real Estate Math Express (Dearborn)

Commission calculations, financing, proration, area, and all exam math explained step by step.

Check Price →

As an Amazon Associate, CJ Affiliate, and AWIN publisher we earn from qualifying purchases. Links above are affiliate links. Full disclosure →