SNDA (Subordination, Non-Disturbance and Attornment)
An SNDA is a three-part agreement among tenant, landlord, and lender. Subordination puts the tenant's lease below the mortgage in priority; non-disturbance protects the tenant's right to stay if the lender forecloses; attornment requires the tenant to recognize the foreclosing lender as the new landlord. Lenders typically require SNDAs from major tenants at closing.
Without subordination, a lease signed before the mortgage could survive foreclosure and bind the lender to its terms. SNDAs give the lender priority while preserving the tenant's occupancy rights, protecting the income stream the loan was underwritten against even through a default scenario.
Sophisticated tenants — anchor retail or large office users in particular — negotiate SNDA terms into their leases upfront, since being asked to sign one later, once a lender is already involved, leaves them less leverage to add protections like rent abatement rights.