What is JUNIOR MORTGAGE?

Mortgage subordinate to a previous, senior mortgage on the same property. Regardless of the situation or action taken, the primary mortgage and mortgagee is satisfied first, then the secondary, then the tertiary, and so on, as is the case. Subordinate mortgages are at greater risk if a default occurs. This typically means that a subordinate mortgage interest rate will be higher that any superior mortgage on the property.

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