Market dispatch·London
Farrer & Co maps the legal route for lenders enforcing security over art
Farrer & Co has published guidance for lenders on enforcing English-law security over artworks, covering when art-secured loan defaults arise, the available forms of security, and the pre-enforcement checks and practical duties lenders must weigh before realising collateral. The piece walks through legal mortgages, fixed and floating charges, pledges and security bills of sale, alongside valuation, cross-border, tax and VAT considerations.
London law firm Farrer & Co has published a September 2026 insight on the key issues facing lenders that enforce security over artworks, noting that defaults under art-secured loans are increasingly common. The guide sets out the main forms of English-law security available over art, including legal mortgages, fixed and floating charges, pledges and security bills of sale. It then works through pre-enforcement considerations: establishing a default under the facility agreement, reservation of rights letters, the validity of the security, demands for repayment, the scope of enforcement powers, practical duties around valuation and sale, cross-border complications, consumer credit issues, and tax and VAT implications. The authors are Bethan Waters, partner, and Charlotte Malthouse, senior associate.
