Hard Money Basics
First Lien Position, Explained
No jargon and no sales pitch. This is how we explain it at the Averlend desk, with the math that matters.
Hard Money Basics
The short version, then the substance.
Key Takeaways
- What a lien position is
- Why lenders insist on first position
- What it means for borrowers
What a lien position is. The lien position is the order creditors get paid if the property sells or forecloses. First lien gets paid first, second gets what is left. Position is established by recording order and controls everything about a loan's risk.
Why lenders insist on first position. A first lien backed by real equity survives almost any scenario. That security is what lets an asset-based lender move fast and lend high. It is also why clean title work happens before every wire.
What it means for borrowers. Know what is recorded against your property before you apply. Old liens, tax liens, and forgotten judgments surface in title review and slow everything down. Pull the issues early and your closing stays on schedule.
The South Texas angle. Averlend underwrites this every week in San Antonio and across Bexar County. If you are working a deal in Alamo Heights or anywhere else in the metro, the theory above comes with a local desk attached: see our San Antonio lending page or send the deal directly.
Questions
Quick answers from the Averlend desk.
The Averlend Promise
Reading is free. So is a deal analysis.
Send the collateral, the numbers, and the exit. An Averlend rep will reach out ASAP, same business day.