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Subordination Agreement
Free subordination agreement template where one lienholder agrees their claim ranks behind another lender's, commonly used in refinancing.
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This free subordination agreement covers 1. Background, 2. Subordination, 3. Scope, 4. No Waiver of Other Rights, 5. Binding Effect and Recording with 8 clearly marked [placeholder] fields to fill in — built for small businesses and individuals documenting a loan or expense putting financial terms in writing so both sides have a clear, shared record. Copy it into your own word processor, fill in the placeholders, and review it — or adapt it — before use. It's part of docstoc's free document template library, alongside business, legal, real estate, finance, and HR templates. Every template here is free to copy with no signup required, and each one carries a plain disclaimer: this is a starting point for informational purposes, not a substitute for advice from a licensed professional in your jurisdiction.
Subordination Agreement
This Agreement is made on [Date] between [Subordinating Lender Name] ("Subordinating Party") and [Senior Lender Name] ("Senior Party"), regarding the property or collateral described below.
1. Background
Subordinating Party holds a [Lien Type, e.g. second mortgage / security interest] on [Property/Collateral Description] (the "Collateral") recorded on [Date] (the "Junior Lien"). Senior Party is [issuing a new loan / refinancing an existing loan] secured by the same Collateral (the "Senior Lien") in the amount of [Amount].
2. Subordination
Subordinating Party agrees that the Junior Lien is, and will remain, subordinate in priority to the Senior Lien, regardless of the order in which the liens were recorded. The Senior Lien will be paid in full before the Junior Lien in the event of foreclosure, sale, or other liquidation of the Collateral.
3. Scope
This subordination applies to the Senior Lien in its original principal amount plus any permitted future advances, interest, and reasonable costs of collection, as described in the Senior Lien documents.
4. No Waiver of Other Rights
Except for the priority subordination described above, this Agreement does not otherwise waive, release, or modify Subordinating Party's rights under the Junior Lien.
5. Binding Effect and Recording
This Agreement binds and benefits the parties and their respective successors and assigns, including any subsequent holder of the Senior Lien or Junior Lien, and may be recorded in the applicable public records to give notice of the priority established here.
6. Governing Law
This Agreement is governed by the laws of the State of [State].
Subordinating Party: ______________________ Date: ____________ Senior Party: ______________________ Date: ____________
*This document is provided for informational and educational purposes only and does not constitute legal advice. Lien priority rules vary by state and lien type — have a licensed attorney or title company review this agreement before recording it.*
Edit directly in the box above. Download PDF anytime — the docstoc.io footer is always included and cannot be removed.
What's included
- Edit online — click the document, fill in placeholders, download a PDF
- 6 standard sections: 1. Background, 2. Subordination, 3. Scope, 4. No Waiver of Other Rights, 5. Binding Effect and Recording, 6. Governing Law
- 8 clearly marked [placeholder] fields for quick personalizing
- Free to use — no account or signup required
- Fully editable — adjust any clause to match your actual situation
- Includes a signature block, ready to print or sign digitally
- Fixed docstoc.io footer on every PDF (not removable)
Who this template is for
Freelancers & solo founders
Handling routine business paperwork without commissioning custom legal drafting for every document.
Small businesses
Standardizing recurring documents — leases, agreements, notices — across a growing operation.
Anyone reviewing before signing
Using a clear starting structure to understand what a document should cover, even if a lawyer finalizes it.
Informal lending & reimbursements
Money changing hands between people or a business and its team, without a bank's paperwork.
FAQ
Is this subordination agreement template really free?
Yes. Like every template in docstoc's library, this subordination agreement is free to use, with no account or signup needed to view, edit, or download it.
What does this subordination agreement cover?
This finance template includes 1. Background, 2. Subordination, 3. Scope, 4. No Waiver of Other Rights. Fill in the [bracketed] placeholders, edit any clause online, then download a PDF — the docstoc.io footer stays on every export.
Is this legal advice?
No. This covers the standard structure, not the interest-rate limits, disclosure requirements, or tax implications that can apply depending on your state and the amount involved. Check those specifics with an accountant or financial attorney before you rely on it.
Can I edit the wording?
Yes. All 8 placeholder fields and every clause are editable right on the page — change what doesn't fit, then download an updated PDF anytime.
Where can I find more free templates like this?
Browse more free finance and related document templates in the docstoc library at /document-templates/.
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