Prior Lien


DEFINITION of 'Prior Lien'

A lien that is recorded prior to any other claims. Prior liens must therefore be paid before any other claims in the event that the collateral that is pledged against the loan must be liquidated. Junior liens are subordinated to prior liens.


A primary mortgage is an example of a prior lien. This mortgage will be paid off before any second or third mortgages, or lines of credit. A perfected security interest is also considered a prior lien.

  1. Encumbrance

    A claim against a property by a party that is not the owner. ...
  2. Property Lien

    A property lien is a legal claim on a tract of real estate granting ...
  3. Non-Possessory Lien

    The legal claim against an asset in order to secure payment of ...
  4. Perfected Lien

    A security interest in the collateral that is used to secure ...
  5. Collateral

    Property or other assets that a borrower offers a lender to secure ...
  6. Lien

    The legal right of a creditor to sell the collateral property ...
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