# Security in ship finance transactions

**URL:** <https://www.queseas.com/t/security-in-ship-finance-transactions/450>\
**Category:** Ship Finance\
**Tags:** ship-finance\
**Created:** [September 11, 2022, 8:43am UTC](https://www.queseas.com/t/security-in-ship-finance-transactions/450 "2022-09-11T08:43:51Z")\
**Posts on this page:** 3\
**Page:** 1

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**Author:** ![Despina.Papaliou](https://avatars.discourse-cdn.com/v4/letter/d/73ab20/32.png) [@Despina.Papaliou](https://www.queseas.com/u/Despina.Papaliou)\
**Post date:** [September 11, 2022, 8:43am UTC](https://www.queseas.com/t/security-in-ship-finance-transactions/450/1 "2022-09-11T08:43:51Z")

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What is the principal security package used in a ship finance transaction?

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**Author:** ![Pauline.Liadi](https://avatars.discourse-cdn.com/v4/letter/p/9d8465/32.png) [@Pauline.Liadi](https://www.queseas.com/u/Pauline.Liadi)\
**Post date:** [September 11, 2022, 7:24pm UTC](https://www.queseas.com/t/security-in-ship-finance-transactions/450/2 "2022-09-11T19:24:53Z")

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Hi Despina 👋  
A typical ship finance transaction is a senior secured loan with a fairly predictable collateral (security) package which usually contains:

- ship mortgages (based on the law of the Flag state)
- general assignments (eg. assignment of vessels’ earnings, insurances)
- letter of undertaking or manager’s undertaking
- account security (based on the law of the location of the relevant account)
- shares security (based on the jurisdiction of the company whose shares are subject to the security)
- subordination agreements/ subordinated debt security (if any)
- pre-delivery security (for newbuilding financings)
- tripartite assignment
- quiet enjoyment letter (for ships on long-term time charter)
- direct arrangements

Of course, every ship finance transaction is different and above described security package can vary on a case-by-case basis.

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**Author:** ![Despina.Papaliou](https://avatars.discourse-cdn.com/v4/letter/d/73ab20/32.png) [@Despina.Papaliou](https://www.queseas.com/u/Despina.Papaliou)\
**Post date:** [September 12, 2022, 8:02am UTC](https://www.queseas.com/t/security-in-ship-finance-transactions/450/3 "2022-09-12T08:02:20Z")

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Thank you Pauline! 🙏