Pennsylvania § 9407 - Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest.
Full text of Pennsylvania Pennsylvania Consolidated Statutes § 9407 — 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.
§ 9407. Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest.
(a) Term restricting assignment generally ineffective.--Except as otherwise provided in subsection (b), a term in a lease agreement is ineffective to the extent that it:
(1) prohibits, restricts or requires the consent of a party to the lease to the assignment or transfer of, or the 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
(2) provides that the assignment or transfer or the 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.
(b) Effectiveness of certain terms.--Except as otherwise provided in section 2A303(g) (relating to requirements for prohibition of transfer in consumer lease), a term described in subsection (a)(2) is effective to the extent that there is:
(1) a transfer by the lessee of the lessee's right of possession or use of the goods in violation of the term; or
(2) a delegation of a material performance of either party to the lease contract in violation of the term.
(c) 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 which 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 section 2A303(d) (relating to certain rights and remedies) unless, and then only to the extent that, enforcement actually results in a delegation of material performance of the lessor.
Cross References. Section 9407 is referred to in sections 2A303, 9401, 9406 of this title.
Source: official Pennsylvania text · Last verified 2026-08-27
Frequently Asked Questions About Pennsylvania § 9407
What does Pennsylvania Consolidated Statutes § 9407 cover?
Section 9407 ("Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest.") is part of the Pennsylvania Consolidated Statutes, the codified statutory law of Pennsylvania. 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 Pennsylvania § 9407?
A common citation format is "Pennsylvania Consolidated Statutes § 9407" (Pennsylvania). 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 Pennsylvania law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Pennsylvania official source linked on this page or consult a licensed Pennsylvania attorney.
How does Pennsylvania § 9407 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Pennsylvania 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 Pennsylvania.