junior mortgage - a real estate loan that is legally subordinate to another loan on the same property. Priority can be established by the time of recording of the mortgage (earliest in time is generally first in priority) or by an agreement called subordination. The effect of priority is that, if the property is sold for less than the amount of all liens, the senior lienholder is paid in full first. Any remaining proceeds are apportioned to junior lienholders in the order of their priority. A foreclosure by a senior lienholder will generally extinguish all junior liens. In some states, the junior lienholder may have personal recourse against the debtor after such a foreclosure. See also nonrecourse debt, priority, recourse debt, and subordination.

© 2004 Bella Vista Publishing Company, Inc.  ISBN 0-9718225-0-6

.
	Copyright Protection:   This real estate web site is created in the United States of America and protected by copyright laws.  Permission should be obtained prior to any reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording or likewise.
.