This agreement allows one lien holder to subordinate its deed of trust to the lien of another lien holder. For valuable consideration, a particular deed of trust will at all times be prior and superior to the subordinate lien.
A Subordination Agreement of Deed of Trust in Ohio is a legal document used when there are multiple mortgages or liens on a property. This agreement allows a party to reposition their position of priority among other lien holders or claimants. It is crucial in situations where a property is being refinanced, sold, or if additional financing is being obtained, as it establishes the order of priority in which the different liens or claims will be satisfied. The Ohio Revised Code (ORC) governs the requirements and provisions of the Ohio Subordination Agreement of Deed of Trust. While the general concept remains the same, there can be different types or scenarios in which this agreement is utilized, including: 1. First Lien Subordination Agreement: This type occurs when a borrower wishes to obtain additional financing but already has an existing first mortgage. The lender of the new loan will require the first lien holder to subordinate their claim to the new lender's lien, enabling the new lender to have priority over the property in case of default. 2. Second Lien Subordination Agreement: This agreement is relevant when there are two existing liens on a property, and the priority of those liens needs to be adjusted to accommodate the needs of a new lender or lien holder. This usually occurs when a property owner takes out a second mortgage, such as a home equity loan or HELOT (Home Equity Line of Credit), while the original first mortgage is still in place. 3. Intercreditor Subordination Agreement: In situations where there are multiple lien holders, such as a first mortgage lender, a second mortgage lender, and other creditors, an intercreditor subordination agreement may be necessary. This type of agreement outlines the priority of each lien holder and their rights in case of foreclosure or sale of the property. When drafting an Ohio Subordination Agreement of Deed of Trust, it is crucial to include specific details such as the names and contact information of all parties involved, a clear description of the property, the existing liens or mortgages, and the terms of subordination. It's essential to consult with a qualified attorney or real estate professional to ensure compliance with the ORC and to address any specific circumstances related to the property or financing arrangement.
