Property Ownership
In Colorado, the 'senior lien' has priority over junior liens because:
AA. It is always a government lien
BB. It was recorded first (or has priority by law), so it is paid first from foreclosure sale proceeds✓ Correct
CC. It has a lower interest rate
DD. It is the smallest lien amount
Explanation
Lien priority in Colorado generally follows the 'first in time, first in right' principle — the first lien recorded has priority. Senior (first priority) liens are paid before junior (subsequent) liens from foreclosure proceeds.
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Key Terms to Know
Lien
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
DeedA written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Community PropertyIn community property states, most property acquired during marriage is owned equally by both spouses, regardless of who paid for it.
Math Concepts
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