What determines the order of mortgages on a property?

The order of mortgages on a property is determined by the date the mortgage is registered officially. This registration establishes a priority system in which the first mortgage registered generally has the first claim to the property's value in the event of a default or foreclosure. Subsequent mortgages registered afterwards will fall behind the earlier ones in terms of priority.

This order of registration ensures that the first lender has a superior position to recoup losses before any subordinate lenders receive any proceeds from the sale of the property. Knowing this is crucial for anyone involved in real estate transactions or mortgage lending, as it affects the risk and financial implications of each mortgage on the property. Understanding the importance of registration dates can also guide homeowners and prospective buyers in considering how multiple mortgages may impact their financial responsibilities and options.