Finance
In Missouri, a second mortgage (second deed of trust) is:
ASuperior in priority to the first mortgage
BSubordinate to the first mortgage in priority✓ Correct
CEqual in priority to the first mortgage
DNot recognized under Missouri law
Explanation
A second mortgage or deed of trust is subordinate to the first. In foreclosure, the first lienholder is paid before any junior liens.
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Key Terms to Know
Deed of Trust
A security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
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.
DeedA written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Math Concepts
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