Priority, Postponement and Standstill Agreement

Summary

This precedent allows for a subsequent mortgage lender or chargee to gain priority over an existing mortgage lender with respect to the receipt of mortgage payments, the enforcement of the mortgage, and other rights which a prior mortgagee/chargee may have otherwise had ahead of the new mortgagee/chargee. The agreement resets the order of priorities despite the prior or original mortgagee being registered ahead of, or advancing funds before, any new lending party. This precedent contains practical guidance and drafting notes. The order in which a mortgage lender or mortgagee/chargee is registered on title to a property is very important. Under Ontario's Land Title System, the priority of a mortgage lender gives the chargee the first chance to enforce on the mortgage security if the borrower goes into default. Furthermore, if the prior lender on title has already made advances on the loan, they are normally entitled to first receive payment back on their loaned money ahead of subsequent...