Sharon borrowed $200,000 in order to purchase a home.She entered into a mortgage agreement with the lender,but the lender never recorded the mortgage.Sharon then borrowed additional money from a second lender and executed a mortgage,which the second lender recorded.Which of the following is true?

Question

Quizplus · Accepted Answer

The first lender's unrecorded mortgage is still valid and enforceable against Sharon, but the second lender's recorded mortgage will take priority because it was recorded first. This is because the doctrine of "first in time, first in right" applies to mortgage priority in most jurisdictions. Therefore, the second lender's rights will be determined without regard to the first lender's mortgage.

Sharon Borrowed $200,000 in Order to Purchase a Home