Chapter 9 - Lien Priority

You may or may not be aware, but a deed of trust is actually a lien on a piece of real property. What is a lien? A lien is a legally recognized claim or hold against one persons item by another which utilizes this item as security for a duty, debt or obligation. If there is more than one lien on a piece of real property there could be a number of reasons for this. Some of the liens an investor may encounter include:

? Tax liens
? Mechanics liens
? IRS liens
? Judgment liens
? Etc.






A few interesting facts about liens
It is important for you to know that liens in first priority are the most ideal. Therefore, in order to obtain this priority, this needs to be verified before the closing of escrow. In order to obtain the accurate information that is required to verify the priority of the deed of trust, you will find that Title insurance policies will provide you with what you need to know.

If it happens that an error is made, or a lien has been overlooked and such aspects affect the trust deed holder, then the holder can take legal action against the company that issued the title insurance policy.

When the holder is in possession of the priority lien, they can foreclose and any junior lien holders wont be able to stop it. That being said, there are ways in which junior lien holders can protect themselves should this happen.

To begin with, they can make certain that their lien has been accurately recorded with the county recorders office. They can also inform all senior lien holders about their lien, and ask them for written notification before they foreclose.


Tax Liens
Tax liens have priority over deeds of trust. This is a fact you wont want to forget should a tax lien appear. Thus, in order for the investor to protect themselves in the event of a tax lien, a provision should be added in the trust deed and note that explains if the borrower and their property have or will receive a tax lien; it is the trustors responsibility to contact the investor.

In addition, the note should provide the investor with the choice of needing the payoff, so that they can protect their principal from foreclosing on the tax lien.

Assignment Deed Of Trust

_ A stock is a gamble.

A Holder in Due Course Note V This particular note is in reference to an individual who is the innocent buyer of the note for value, and was oblivious to any defects that existed within the note when purchased. Just because short term loans are primarily funded based on real estate equity, you should discover what the borrower has already pre-approved for their take out loan. However, if problems do arise, the borrower is encouraged to set them right should they wish to protect their equity in the project. When the instructions have been completed, it is then important for the investor to read the preliminary title report more than once to ensure that everything is understood and nothing has been overlooked or missing.

How much money is required to make a Mortgage Investment?
Know the market value and equity of the real property, as well as your loan security. LTV is the percentage of the loan to the property value. Currently, Coppercrest Funding is proud to work with almost 50 active investors. It is through strict and constant enforcement that reliable payment and performance is maintained. Although it is evident that there are many differences between trust deeds and other types of investments, one thing is for certain V a trust deed is an investment opportunity that offers you a high return with less risk. Just because short term loans are primarily funded based on real estate equity, you should discover what the borrower has already pre-approved for their take out loan.

Confirmation of the zoning letter issued by the city/county that confirms the zoning for the property.
However, the vast majority of notes are transferable through endorsement. Chapter 14 - Frequently Asked Questions Since you are new to mortgage investing, you may have questions in regards to what it is, what it can do for you, and if mortgage investing is really worth it in the long run. The note, on the other hand, shows the initial amount that is owed based on the terms and conditions regarding the repayment of the trust deed. You should make it a point to know how the borrower is planning to pay the private money loan.