Escrow & TitleIntermediateAlaska Exam

In Alaska, when multiple liens exist on a property and it is sold at foreclosure, which general priority rule applies?

AThe largest lien is paid first
BPriority is typically determined by the order of recording (first to record has first priority), with certain exceptionsCorrect
CGovernment tax liens are always last in priority
DVoluntary liens (mortgages) always have priority over involuntary liens, though outcomes can differ depending on circumstances

Why Priority is typically determined by the order of recording (first to record has first priority), with certain exceptions Is Correct

Answer B: Priority is typically determined by the order of recording (first to record has first priority), with certain exceptions

Generally, priority among liens is determined by the order of recording — earlier recorded liens have priority over later recorded ones. However, important exceptions exist: property tax liens have super-priority regardless of recording date, and some statutory liens (like mechanics' liens) have special priority rules.

Exam Tip: Escrow & Title

Escrow questions test the neutral third-party role and the sequence of closing events. Remember that the escrow agent acts as a dual agent for both buyer and seller and cannot advocate for either side.

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