This is an official Washington form for use in land transactions, a Subordination Agreement (with representative acknowledgments).
An Everett Washington Subordination Agreement is a legal document that establishes the priority of different liens or claims on a property in Everett, Washington. It allows one party to voluntarily "subordinate" their rights to another party's interests, usually in the context of a mortgage or loan. There are two main types of Everett Washington Subordination Agreements — Junior LieSubordinationns and Leased Fee Subordination. 1. Junior Lien Subordination: This type of agreement is commonly used when a property owner seeks additional financing and already has an existing mortgage or lien in place. In this scenario, the lender providing the new financing requires the current creditor to subordinate their claim to the new lender's interest. By doing so, the new creditor becomes the first lien holder, and the previous creditor accepts a lower position in priority. 2. Leased Fee Subordination: This agreement is often encountered when a property with a leasehold interest, such as a tenant's rights, is being financed or sold. The owner of the leased fee, which is the underlying ownership interest, may need to obtain financing or sell the property. In such cases, the leasehold interest holder must agree to subordinate their rights to the leased fee owner or the new creditor. This agreement ensures that the leased fee owner's interest takes precedence over the leasehold interest in case of default or foreclosure. Representative acknowledgments in an Everett Washington Subordination Agreement typically include: 1. Acknowledgment of Prior Lien: The party agreeing to subordinate their interest acknowledges the existence of the prior lien or interest that holds priority over their own. 2. Agreement to Subordinate: The party agrees to subordinate their rights and claims to the interests of the other party involved, effectively accepting a lower position in priority. 3. Priority Assurance: The agreement includes a clause ensuring that if the prior lien is released, satisfied, or otherwise removed, the subordination becomes null, and the party's rights and claims regain their original priority. 4. Waiver of Rights: The party acknowledges that, by subordinating their rights, they may have limited or delayed access to the property's proceeds or other benefits until the priority of the prior lien is satisfied. 5. Indemnification: The subordinating party may request indemnification from the other party for any losses or damages that may occur as a result of the subordination. It is crucial to consult with a legal professional experienced in real estate law when drafting or entering into an Everett Washington Subordination Agreement. The specific terms and conditions may vary depending on the parties involved, the type of lien or interest being subordinated, and the intended purpose of the agreement.
