Legal Definitions - subsequent creditor

Definition: A subsequent creditor is a person or entity that lends money or extends credit to a borrower after another creditor has already done so.

For example, if John borrows $10,000 from Bank A and then later borrows $5,000 from Bank B, Bank B is considered a subsequent creditor because they lent money to John after Bank A did.

This term is important in legal and financial contexts because subsequent creditors may have different rights and priorities than the original creditor. For instance, if John defaults on his loans, Bank A may have priority over Bank B in collecting any assets or funds that John has to repay his debts.