subordination

Hi Karthik,

A subordination agreement is where a subsequent mortgage is allowed to take preference over a previous mortgage. Lenders who have provided credit to the same borrower enter into some kind of subordination agreement to fix the priority of repayment rights against the borrower.

Thanks
Reid

hi karthik,

let me explain what a re-subordination means. when a previous first mortgage is paid off the second mortgage holder automatically becomes the primary or first mortgage/lien holder. sometimes when refinancing the first mortgage the new lender will not accept having a secondary position thus re-subordination will occur if the second mortgage lender agrees to remain in his secondary position or have the secondary lien to the new mortgage lender.

thanks
james

Hi Karthik,

You can view this previous discussion on subordination to get more information about the topic.
http://www.mortgagefit.com/discuss/subordinate-second.html

Thanks
Colin