10 Examples of Subordination being used for a No Money Down Commercial Property Purchase

Here are 10 examples of a subordination as an option for a no money down commercial property purchase:

1. Seller Subordination: The seller agrees to subordinate their mortgage to the buyer’s new loan, allowing the buyer to obtain a larger loan amount or better financing terms.
2. Second Lien Subordination: The seller agrees to subordinate their mortgage to a second lien lender, allowing the buyer to obtain a larger loan amount or better financing terms from the primary lender.
3. Intercreditor Agreement: The seller agrees to enter into an intercreditor agreement with the buyer and their lender, outlining the priority of their respective liens on the property.
4. Junior Mortgage: The seller agrees to take a junior mortgage position behind the buyer’s new loan, allowing the buyer to obtain financing without having to pay off the seller’s mortgage.
5. Payment Subordination: The seller agrees to subordinate their right to receive payments from the buyer until the buyer’s new loan is paid off, ensuring the lender has first priority to receive payments.
6. Future Advances Subordination: The seller agrees to subordinate their mortgage to any future advances made by the buyer’s lender, allowing the buyer to obtain additional financing as needed.
7. Partial Subordination: The seller agrees to subordinate a portion of their mortgage to the buyer’s new loan, allowing the buyer to obtain a larger loan amount or better financing terms on that portion.
8. Subordination of Easements: The seller agrees to subordinate their easement rights (such as access to the property) to the buyer’s lender, ensuring the lender has first priority to enforce those rights.
9. Subordination of Leases: The seller agrees to subordinate their leasehold interests in the property (such as rent payments from tenants) to the buyer’s new loan, ensuring the lender has first priority to enforce those interests.
10. Subordination of Liens: The seller agrees to subordinate any other liens they hold on the property (such as mechanic’s liens) to the buyer’s new loan, ensuring the lender has first priority to enforce those liens.