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.

Okanogan County Deed Of Trust

Investing in a deed of trust generates a monthly income that is established through interest payments.

In addition, Coppercrest Funding is pleased to see this same development of trust blossoming with their other investors, and always look forward to developing future relationships with new investors. To be on the safe side, it is always in your best interest to ask whether or not a construction control company is used. Make sure you understand all legalities concerning trust deeds before you make your investment. The price at which the property was purchased 5.

(Note: Keep in mind that each state may have their own process of foreclosure, so the following information may not apply to your area)1.
The use of such loan proceeds can fund the installing of utilities, water pipers, sewers, streets, gutters, curbs and related utilities. Borrowers that create this type of problem can often be extremely difficult for an investor to deal with, especially if the investor is new to private money lending. Are their Precautions I should take? _ The value of a deed of trust is fixed and is always stable. Once this notice has been sent, the subcontractor has been given the right to lien a project. The process of underwriting is what the lender goes through in order to qualify a borrower for a loan, and also makes certain that the loan has been properly documented and structured.

Different areas use different methods.
warehouses, factories, port facilities, mills, ships, etc. As far as monetary is concerned, the defaults include are as follows: _ Nonpayment of a balloon payment (when all the payment is due at one time)_ Advancements for each provision of the trust deed in regards to insurance or taxes. A legal description of the property that is to be transferred 4. Aside from the Real Estate Law, you may find that your loan documents will feature another legal document known as the federal Truth-in-Lending Act (TILA). Why do I want to get involved with trust deed investing? 00 annual retirement income to Mary at 2.