Our purchase money mortgage (PMM) functionality is available in connection with orders where the collateral real property is in certain states, i.e., Alabama, Iowa, Maryland, Minnesota. Opting to include the PMM language in the mortgage/deed of trust ensures that the lien of the instrument benefits from that state’s particular PMM lien priority protections.
Generally speaking, the intended use of a PMM is to memorialize that the lien of the mortgage/deed of trust is to be given priority over other competing liens on the collateral real property when all or a portion of the lender’s loan is to be used to acquire the property.
A PMM can be used in certain scenarios, such as seller carryback financing or in instances where there are other liens against the property, e.g., judgment liens, in existence before the lender makes its loan to the borrower to purchase the property.
The difference between Alabama specific box checked vs not checked:
The difference between Iowa specific box checked vs not checked:
The difference between Maryland specific box checked vs not checked:
The difference between Minnesota specific box checked vs not checked:
The above is a summary of GoDocs' PMM functionality and of our understanding of the applicable laws permitting its use. Given the nuances of when a PMM is appropriate to use, GoDocs recommends you consult with your legal counsel to confirm whether a specific transaction qualifies for its use or is the recommended approach for your order.