Question

A clause in a second trust deed that permits the first trust deed to be refinanced without affecting its priority would be known as a

Answer 1

A clause in a second trust deed that permits the first trust deed to be refinanced without affecting its priority is known as a subordination agreement.

Step-by-step explanation:

A clause in a second trust deed that permits the first trust deed to be refinanced without affecting its priority is known as a subordination agreement.

A subordination agreement is a legal document that establishes the priority of liens on a property. In this case, the agreement allows the first trust deed to retain its priority even if the first trust deed is refinanced.

This clause is often included in loan agreements to protect the lender's interest and ensure that the first trust deed maintains its position as the primary lien on the property.