by Brian Street
The doctrine of equitable subrogation, particularly as applied to priority of mortgage liens, has long been a tool used by real property litigators seeking to rectify or mitigate priority issues caused by defectively executed or recorded mortgages. As a general rule, equitable subrogation is available to substitute (subrogate) a refinancing lender to the position of the mortgage or lien that the lender satisfied. The later lender, who anticipated taking the subrogated position when making the subject loan, is permitted to assume the lien priority of the loan it satisfied, notwithstanding its failure to gain de jur priority pursuant to Ch. 695’s strict recording rules.

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