Escrow & Title
A subordination agreement is used to:
ATransfer a mortgage from one property to another
BAllow a previously recorded lien to have lower priority than a new lien✓ Correct
CAutomatically pay off a second mortgage when the property is sold
DProtect a tenant's lease in case of foreclosure
Explanation
A subordination agreement is a contract in which a lienholder (such as a first mortgage lender) agrees to give priority to a new lien (such as a new construction loan), voluntarily moving to a lower priority position.
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