I want to have a secured loan and want to put the land as collateral. However, there is an existing bank loan on the land that has first priority. Can I still put the land as collateral or do I need the bank's permission? What if I don't record, do I still need the Bank's permission? Thank you...
If the security interest is real property, then you will need to record your lien with the County Clerk where the land is located to protect your interest, otherwise you risk not being able to enforce your interest. New York is a "race-notice" jurisdiction, which means that while you don't have to record your lien, if you want to prove you have an enforceable security interest, then you will have to record the lien as I mentioned. You shouldn't need the bank's permission to record your lien if you are willing to have your lien be subordinate to the bank's lien.
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