Updated on July 26, 2018
This is the first part of a two-part series on liens and priorities. This first part is an introduction to liens and priorities and the second part will discuss a case decided recently on lien priority and simultaneous recordings.
Liens are created in two ways: (1) by operation of law, and (2) by contract (Civ. Code, § 2881). The deed of trust is an example of a lien created by contract. (Monterey S. P. Partnership v. W. L. Bangham, Inc. (1989) 49 Cal. 3d 454, 460.)
To properly record an instrument, the instrument must be duly acknowledged or proved and certified, and be deposited in the Recorder’s office, with the proper officer, for record. (Cal. Civ. Code § 1170.)
The above rule on priority does not always apply. The “explicit caveat in applying the “first in time, first in right” rule . . . is that all other things must be equal.” (DMC, Inc. v. Downey Savings & Loan Assn (2002) 99 Cal. App. 4th 190, 195-96.) A purchase-money mortgage is one of the exceptions. Once the existence of a purchase-money mortgage is established, the purchase-money lien has priority over all other liens on real property. (Id.)
Our real estate attorneys at Schorr Law have a great deal of experience with real estate matters and disputes, including liens and priorities, the recording of liens, as well as the removal of them. To see if you qualify for a free 30-minute consultation, contact us today!
By: Randy Aguirre, Esq.