Other things being equal, different liens upon the same property have priority according to the time of their creation, except in cases of bottomry and respondentia.
Liens in GeneralPriority of Liens
Section § 2897
This law says that when there are several claims on the same property, the claim that was made first has the right to be paid off first. However, there are exceptions for specific types of maritime loans called bottomry and respondentia.
liens property claims priority
Section § 2898
When you buy a property and take out a mortgage or deed of trust at the same time, this mortgage or deed gets priority over any other debts against the buyer, as long as all documents are properly recorded. Additionally, if you're dealing with a lease on property, the rules for determining which debts take priority are the same as those for property sales.
(a)CA Civil Law Code § 2898(a) A mortgage or deed of trust given for the price of real property, at the time of its conveyance, has priority over all other liens created against the purchaser, subject to the operation of the recording laws.
(b)CA Civil Law Code § 2898(b) The priority of the lien of a mortgage or deed of trust on an estate for years in real property shall be determined in the same manner as for determining the priority of a lien of a mortgage or deed of trust on real property.
mortgage priority deed of trust property conveyance
Section § 2899
If a person has a lien on multiple items and others have secondary liens on some of those items, the person with the first lien must choose the items to satisfy the lien in a specific order, provided it doesn't cause them loss or unfairness to others. First, they should look at items they alone have a lien on. Next, they should look at items with the fewest secondary liens, then those with more. Within these groups, they should prioritize items that haven't changed hands since the lien, those given away, and lastly, those sold, in reverse order of sale.
Where one has a lien upon several things, and other persons have subordinate liens upon, or interests in, some but not all of the same things, the person having the prior lien, if he can do so without risk of loss to himself, or of injustice to other persons, must resort to the property in the following order, on the demand of any party interested:
1. To the things upon which he has an exclusive lien;
2. To the things which are subject to the fewest subordinate liens;
3. In like manner inversely
to the number of subordinate liens upon the same thing; and,
4. When several things are within one of the foregoing classes, and subject to the same number of liens, resort must be had—
(1.) To the things which have not been transferred since the prior lien was created;
(2.) To the things which have been so transferred without a valuable consideration; and,
(3.) To the things which have been so transferred for a valuable consideration in the inverse order of the transfer.
lien priority subordinate liens exclusive lien
