Property Ownership
In Louisiana, a mortgage may be given priority over earlier-recorded liens in which of the following situations?
AWhen the mortgagee is a federal government agency
BWhen the mortgage secures the purchase price (vendor's privilege) — the seller's lien may have priority for the unpaid price✓ Correct
CWhen the mortgage is larger than the earlier liens
DWhen the mortgagee has better credit than the earlier lienholders
Explanation
In Louisiana, the vendor's privilege (seller's lien for unpaid purchase price in a Credit Sale) may have priority over other contemporaneous or subsequent claims — an exception to the general first-in-time priority rule, designed to protect sellers who extend credit.
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