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Real Property • Security Interests in Real Estate
PROP#223
Legal Definition
Generally, a mortgage's priority is determined by the time it was placed on the property.
Plain English Explanation
People can take out multiple mortgages on a property. Since each mortgage gives someone the right to foreclose, the law needs a way to figure out who gets first dibs and who has to wait in line to get paid. Generally speaking, a mortgage's priority is first-come first-serve. In other words, each additional mortgage has a lower priority than a mortgage placed before it.
Related Concepts
How do states treat a mortgage without a note?
How do states treat a note without a mortgage?
How may a party be a holder in due course of a note?
In lieu of foreclosure, what do many installment contracts prefer and how do courts address this alternative?
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