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Security for the Private Money Investor is not only dependent upon the property, but the position of the lien instrument when the loan is closed.

Lien Position

Lien position simply refers to the priority of a lien which has been recorded onto the property. The manner in which lien priority is issued is by recording time and date. Recordings are performed at, appropriately, the County Recorder's Office in the County in which the subject property lies.

Additionally, if a lien is in a priority position of several liens, for example the 1st of 3 liens, is released, the 2nd and 3rd position liens would move into 1st and 2nd position, respectively.

Who determines lien position can vary for each transaction. If you were to lend money directly to an individual, you could go down to the Recorder's Office, sit down at a computer in their lobby, pull up the property and check for liens and their positions. Although this is a valid method of obtaining lien priority, all lenders will want a professional Title Company to provide a report of the title. Also, Title Companies provide Title Insurance which insures the lender for the lien position and dollar amount which was agreed upon by all parties. For more detail, go to our page on Title Insurance.

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CSI Mortgage Corp.tm
9832 N. Hayden Rd., Ste. 213, Scottsdale, AZ 85258
(480) 860-4028(800) 758-1793FAX (480) 451-4516
Arizona Mortgage Broker #0911216