Which statement about lien priority among liens is true?

Which statement about lien priority among liens is true?

• A. The most recently recorded lien has priority.
• B. The largest monetary lien has priority.
• C. Taxes and assessments usually have priority over private liens; among private liens, first in time generally wins.
• D. The person who records earliest and has notice wins.

Answer: (C)

The main idea is how lien priority is arranged. Taxes and assessments have the highest priority and take precedence over private liens, because governments need to collect those charges before other claims against the property are paid. Among private liens, the rule is typically first in time, first in right—so the lien that was recorded first generally has priority over later-recorded private liens. This approach provides certainty for lenders and ensures public taxes aren’t jeopardized by later claims. So the statement that taxes and assessments usually have priority over private liens, and among private liens, first in time generally wins, is the true description of how lien priority works. For contrast, a lien’s size or the debtor’s knowledge do not determine priority, and recording earlier with notice is not the controlling factor for private liens.

The main idea is how lien priority is arranged. Taxes and assessments have the highest priority and take precedence over private liens, because governments need to collect those charges before other claims against the property are paid. Among private liens, the rule is typically first in time, first in right—so the lien that was recorded first generally has priority over later-recorded private liens. This approach provides certainty for lenders and ensures public taxes aren’t jeopardized by later claims. So the statement that taxes and assessments usually have priority over private liens, and among private liens, first in time generally wins, is the true description of how lien priority works. For contrast, a lien’s size or the debtor’s knowledge do not determine priority, and recording earlier with notice is not the controlling factor for private liens.