A property in New York is being foreclosed, and there are multiple parties with interests in the property including a second mortgage holder and a mechanics lien claimant. How does the court determine the order of payment from foreclosure sale proceeds?
Correct Answer
B) Claims are paid based on the priority established by law and recording dates
Payment priority in New York foreclosures is determined by established legal priority rules combined with recording dates. For example, properly recorded mortgages generally have priority over later-recorded liens, but some liens (like certain tax liens) may have statutory priority regardless of recording date.
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