Private loans are loans that are made by private parties/ investors. Since the primary remedy available to such investors is foreclosure, they tend to be conservative with loan-to-value ratios, but liberal everywhere else. They look, in general, to the property for security. They are not written to conforming guidelines. These loans can be sold, usually to to other investors, and usually at a *discount. A broker can also arrange the sale of these notes. It is common for these loans to stay with the original investor for their entire term. The investor decides which risks they are willing to take, and makes their lending decisions based upon their own guidelines rather than those of the larger market.
Recording essentially means recording an image at the County Reorders office. When Trust Deeds are recorded they become part of the public record. When a title company or investor investigates the Record of a particular property or person, they are looking at these documents. The Record follows the property until it is satisfied and a formal release is filed. In the case of a Trust dead, this release is called a reconveyance.
Order of recording. In California notes are “ranked” according to the date and time recorded. They are public record, so anyone who is interested can inquire with the county recorder, and see who hold a secured interest against a given property. A Lien is simply something attached to a property that requires the payment of money. Mortgages, Judgments, and taxes are all liens. There is also something called a mechanic’s lien. These protect contractors who work on your property and helps insure that they will be paid. They also sometimes take priority over mortgage liens. This is why when a property is under construction lenders tend to shy away from lending on that property.