An agreement that changes the priority of liens is a legal document that can have significant consequences for all parties involved. In essence, a lien is a legal claim against a property that provides security for a debt or obligation. For instance, a mortgage lien is a claim placed on a property to secure a home loan. In such cases, the mortgage lender has a higher priority lien than any other claimants.

However, circumstances can arise where parties that hold lesser priority liens wish to change the pecking order. In such cases, the parties may need to enter into a lien subordination agreement to alter the priority of the liens. This legal document changes the order in which creditors can claim repayment from the property owner in the event of a foreclosure.

A lien subordination agreement can be beneficial to parties looking to refinance their property. For instance, if a property owner has a first mortgage and a second mortgage, a lien subordination agreement can help ensure that the first mortgage remains the priority lien. This can help a borrower qualify for a better interest rate or loan terms.

The agreement is typically drafted by an attorney and must be properly executed and recorded in the relevant public records. It must also be approved by all parties involved, including the lenders holding the senior and junior liens.

It is important to note that a lien subordination agreement can also be disadvantageous to some parties, especially those holding a higher priority lien. For example, if a lender holding the first mortgage agrees to subordinate to a second mortgage lender, it would place the first lender in a precarious position in case of default.

In conclusion, a lien subordination agreement is a legal document that can change the priority of liens. However, parties must carefully consider the consequences before entering into such an agreement. It is advisable to seek counsel from an experienced attorney to ensure that all parties` interests are protected.