Escrow & Title
In Colorado, a 'subordination agreement' in real estate involves:
AA. A buyer agreeing to take title subject to existing liens
BB. A lienholder (usually a junior lender) agreeing to allow their lien to remain in a lower priority position relative to a new senior lien✓ Correct
CC. A title company agreeing to insure a disputed title
DD. A court reducing a lien's priority due to fraud
Explanation
A subordination agreement is a written agreement by which a lienholder (such as a seller who holds a purchase money second mortgage) consents to allow their lien to remain subordinate (junior) to a new or refinanced first lien. Without this agreement, a new first mortgage might not take priority over the existing lien.
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