A subordination agreement is a legal document that allows a borrower to refinance their existing mortgage while keeping the same priority status for their new loan. In the context of Iowa, the Iowa Subordination Agreement Subordinating Existing Mortgage to New Mortgage helps facilitate the process of refinancing a mortgage by establishing the order of priority between the existing mortgage and the new mortgage. This agreement is crucial in situations where there are multiple lien holders, and it ensures that the new mortgage is given the desired priority over any other existing mortgages. In Iowa, there are primarily two types of subordination agreements that can be used to subordinate an existing mortgage to a new mortgage: 1. Iowa Form 47875 Subordination Agreement: This is a standard form provided by the Iowa state government, which outlines the terms and conditions of the subordination agreement. It typically requires the signature of both the existing mortgage lender and the borrower, along with any additional lien holders involved. This form is easily accessible and widely used in Iowa. 2. Customized Iowa Subordination Agreement: While the Iowa Form 47875 is commonly used, some situations may require a customized subordination agreement tailored to the specific needs of the parties involved. This type of agreement takes into account the unique circumstances of the refinancing and may involve negotiations between the various stakeholders, including mortgage lenders and potentially other lien holders. The Iowa Subordination Agreement Subordinating Existing Mortgage to New Mortgage typically includes several key clauses and terms: 1. Identification of the Parties: This section includes the names and contact information of the borrower, existing mortgage lender, and any additional lien holders involved. 2. Existing Mortgage Details: This clause outlines the essential details of the existing mortgage, such as the principal amount, interest rate, and repayment terms. 3. New Mortgage Details: Similarly, this clause highlights the key information about the new mortgage, including the principal amount, interest rate, and repayment terms. 4. Subordination of Existing Mortgage: This section clearly states the intent of the parties to subordinate the existing mortgage to the new mortgage, thus granting the new loan priority status. 5. Priority of the New Mortgage: This clause emphasizes that the new mortgage will rank first in priority ahead of any other existing mortgages or liens. 6. Consent and Acknowledgment: The agreement includes provisions where the borrower and existing mortgage lender acknowledge their consent to the subordination and agree to abide by the terms of the agreement. 7. Recording and Filing: This section explains the process for recording and filing the subordination agreement with the appropriate county officials to ensure it is legally binding and publicly accessible. It's important to note that the content and structure of an Iowa Subordination Agreement Subordinating Existing Mortgage to New Mortgage may vary depending on the specific circumstances and lender requirements. Consulting with legal professionals and mortgage lenders is highly recommended ensuring compliance with applicable laws and to safeguard the interests of all parties involved.