In Colorado, a 'subordination agreement' in real estate lending means:
Why A lender agrees to take a lower priority position relative to a new or different lien Is Correct
Answer A: A lender agrees to take a lower priority position relative to a new or different lien
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.
Key Escrow & Title Terms in This Question
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Key Terms to Know
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
EasementA non-possessory right to use another person's land for a specific purpose.
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