Senior Lien Maintains Priority Modifications are Junior
In the case of Lennar Northeast Partners v. Buice Revocable Living Trust, the appellate court found that when certain modifications to a senior lien increased the underlying obligation, it was just the modifications, and not the entire lien, that lost its priority. In Lennar, the senior lienholder modified its note with the borrower by extending the term, increasing the interest rate and increasing the principal amount. a junior lienholder whose note was in default sued for judicial foreclosure and claimed its lien was a valid first lien since the modifications of the senior had substantially changed the terms of the original note, which materially affected the security of the junior's lien, thereby resulting in its loss of priority. Though the appellate court agreed that the modifications were material, it did not agree with the junior lienholder that such modifications resulted in the loss of the priority of the entire senior lien.
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