Opinion ID: 1954146
Heading Depth: 1
Heading Rank: 3

Heading: Surplus rents.

Text: Ordinarily, a debtor is entitled to possession of real property during the redemption period, and, if entitled to possession of the real property, the debtor is also entitled to the rents generated from the property. Iowa Code § 628.3; Community State Bank, Paton v. Cottington, 444 N.W.2d 484, 486 (Iowa 1989); Moad v. Neill, 451 N.W.2d 4, 7 (Iowa App.1989). A debtor may also be entitled to rents held by a receiver even though dispossessed by virtue of the receivership. See Federal Land Bank of Omaha v. Heeren, 398 N.W.2d 839, 844 (Iowa 1987). A mortgagee has a lien on rents from the date of execution of the mortgage if the mortgage conveys the rents in the granting clause rather than merely pledging them as collateral or as additional security in the event of a default. Federal Land Bank of Omaha v. Lower, 421 N.W.2d 126, 128 (Iowa 1988). Here, the rents were conveyed to Norwest in a separately recorded assignment of rents dated December 18, 1972. This assignment provided the mortgagor: does hereby sell, assign and transfer unto the mortgagee all the rents, issues and profits now due and which may hereafter become due ... it being the intention hereby to establish an absolute transfer and assignment of all the said leases and agreements.... Norwest's lien on the rents attached upon the execution of this assignment. Thus, Norwest was not required to foreclose its mortgage on the realty and seek appointment of its own receiver to have a lien on the rents in the receiver's possession. Bridgewood argues that Norwest gave up its right to any rents when it waived its right to a deficiency judgment. We disagree. This waiver only relates to a personal judgment against the defendants of the cross-petition. Norwest bargained for, and received, an absolute assignment of rents. The real estate remains subject to its first mortgage. The debt secured has not been satisfied. While Norwest may not look beyond its security to satisfy the debt, it can look to the real estate and rents. Norwest is entitled to exercise its rights against the surplus rents irrespective of its waiver of deficiency. Accordingly, we affirm the district court decision. AFFIRMED.