August 1, 2019 - Mortgage recorded
January 3, 2020 - Lien recorded
January 31, 2020 - Owner conveys to Buyer 1; Buyer 1 records
These transactions take place in a notice/race state.
Suppose on February 11, 2020, the owner conveys to Buyer 2. Assume Buyer 1 does not record. If the owner defaults, who gets the property?

Question

Quizplus · Accepted Answer

In a notice/race state, the first to record the interest in the property has priority, unless they had notice of another's prior unrecorded interest. Since the mortgage was recorded first (August 1, 2019), before any other transactions, the mortgage company has priority. If the owner defaults, the mortgage company has the primary claim to the property.

August 1, 2019 - Mortgage Recorded