Mortgage with first-priority claim on a property, typically the senior lien that gets paid before junior mortgages after foreclosure.
A first mortgage is the mortgage with first-priority claim on a property. If the borrower defaults and the property is foreclosed, this lender gets paid before junior mortgage holders.
In practical mortgage language, senior mortgage and primary mortgage usually point to the same top-priority loan position.
First-mortgage status matters because repayment priority lowers lender risk. That usually supports lower rates, larger loan amounts, and better terms than a subordinate mortgage would receive.
For borrowers, it is the baseline mortgage relationship. For other lenders, it is the claim that everyone else on the property has to stand behind.
The first mortgage is usually the original purchase loan or the refinanced loan that keeps the top lien position after the prior debt is discharged.
| Mortgage position | Claim on sale proceeds | Typical pricing effect | Common use |
| — | — | — | — |
| First mortgage | Paid before junior liens | Lowest risk, often lowest rate | Main purchase or refinance loan |
| Second mortgage | Paid after the first mortgage | Higher risk, often higher rate | Equity extraction or layered financing |
| Junior mortgage | Paid after senior claims | Risk rises as priority drops | Broad category including second and third liens |
When reviewing First Mortgage, ask whether it changes collateral value, lien priority, property cash flow, borrower capacity, closing funds, servicing, refinancing, or recovery proceeds. If it does, tie First Mortgage to the loan file, title or contract evidence, underwriting ratio, and exit-risk assumption.
Second Mortgage: A subordinate mortgage that stands behind the first mortgage in repayment order.
Junior Mortgage: The broader category for mortgages that rank below a senior mortgage.
Loan-to-Value Ratio: A core underwriting measure often used when sizing a first mortgage.
Foreclosure: The enforcement process that makes mortgage priority economically important.
Wraparound Mortgage: A structure that can leave an older first mortgage in place under a new seller-financed note.