A Mortgagee Allows a Clause in His Contract Stating That

question 49

True/False

A mortgagee allows a clause in his contract stating that another lender's interest will be allowed to take precedence over his own. This clause is a subordination clause.

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Definitions:

Accounts Payable Balance

The total amount of money a company owes to its suppliers or creditors for goods and services purchased on credit.

Unearned Revenue

Income received by a business for goods or services yet to be delivered or provided; also known as deferred revenue.

Prepaid Expense

Payments made beforehand for products or services that will be provided at a later date.

Cash Receipt

A document acknowledging the receipt of cash, often provided to a customer who makes a payment.