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Subordinate Financing

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Subordinate Financing

A second mortgage on a property that is not paid off when the first mortgage is refinanced.

The second mortgage lender must allow subordination of the second to the new first mortgage. See Second Mortgage/Subordination by Second Mortgage Lender.



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The New York City Housing Development Corporation is providing $11 million in tax-exempt bonds and $4,565,000 in subordinate financing.
The FHA Secure Loan Program has also encouraged lenders to be more flexible and allow subordinate financing (second Mortgage) to make up for the difference between the current loan balance and the new FHA loan.
The Alliance's proposal also suggested a minimum down payment of only $500 from personal funds, with private subordinate financing making up the rest.
 
 
 
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