Georgia § 11-9-407 - Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest.
Full text of Georgia Official Code of Georgia Annotated § 11-9-407 — Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest., with citation guidance and answers to common questions.
§ 11-9-407. Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest.
Term restricting assignment generally ineffective. Except as otherwise provided in subsection (b) of this Code section, a term in a lease agreement is ineffective to the extent that it: Prohibits, restricts, or requires the consent of a party to the lease to the assignment, transfer, creation, attachment, perfection, or enforcement of a security interest in an interest of a party under the lease contract or in the lessor's residual interest in the goods; or Provides that the assignment, transfer, creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the lease. Effectiveness of certain terms. Except as otherwise provided in subsection (7) of Code Section 11-2A-303, a term described in paragraph (2) of subsection (a) of this Code section is effective to the extent that there is: A transfer by the lessee of the lessee's right of possession or use of the goods in violation of the term; or A delegation of a material performance of either party to the lease contract in violation of the term. Security interest not material impairment. The creation, attachment, perfection, or enforcement of a security interest in the lessor's interest under the lease contract or the lessor's residual interest in the goods is not a transfer that materially impairs the lessee's prospect of obtaining return performance or materially changes the duty of or materially increases the burden or risk imposed on the lessee within the purview of subsection (4) of Code Section 11-2A-303 unless, and then only to the extent that, enforcement actually results in a delegation of material performance of the lessor. (Code 1981, § 11-9-407 , enacted by Ga. L. 2001, p. 362, § 1.)
Source: official Georgia text · Last verified 2026-08-27
Frequently Asked Questions About Georgia § 11-9-407
What does Official Code of Georgia Annotated § 11-9-407 cover?
Section 11-9-407 ("Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest.") is part of the Official Code of Georgia Annotated, the codified statutory law of Georgia. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Georgia § 11-9-407?
A common citation format is "Official Code of Georgia Annotated § 11-9-407" (Georgia). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Georgia law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Georgia official source linked on this page or consult a licensed Georgia attorney.
How does Georgia § 11-9-407 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Georgia can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Georgia.