How is the lender's security affected if registration is delayed?

• A. It remains unaffected
• B. It becomes void
• C. It may be subordinate to third party interests
• D. It is automatically perfected

Answer: (C)

Registration sets the notice and priority of a lender’s charge over the land. When a security is created, it must be perfected by registering it so that it can take effect against the world. If registration is delayed, other interests can be entered or registered in the meantime, and those third party interests can take precedence over the lender’s charge. In practice, this means the lender’s security may end up subordinate to those previously or subsequently registered interests, reducing the lender’s protection. Perfection by registration is what solidifies priority, so a delay can undermine that protection, leading to a lower ranking in the event of a sale or enforcement.