Q: Foreclosed property has 2 bank liens, primary lien holder filed suit & has a judgement. If I win property at auction am
I then liable for the 2nd lien on the property or does the foreclosure & bankruptcy process eliminate my liability?
A: Typically, if a first lien holder goes to judgment first, the second is wiped out by the first. However, I strongly recommend that you get a title search before you start bidding. This can be a dangerous area and activity. Many people have lost their life savings due to not properly checking the title. Proceed at your own risk.
Richard Paul Zaretsky agrees with this answer
A:
You did not mention where the bankruptcy comes into the picture.
In a foreclosure the priority of the lien of the mortgage that filed the foreclosure is the key important factor.
If the foreclosure is by the first mortgage then this foreclosure would eliminate the second mortgage if the lawyers did the lawsuit correctly.
You would not be liable for any mortgage since you did not sign any mortgage. However you should consult with a knowledgeable real estate attorney to better understand the specifics of the foreclosure on this particular house.
A: Generally if a junior lien is named in the senior foreclosure case they are foreclosed out upon sale. But you should not be bidding on real estate without an attorney to begin with as there may be other things hiding like code violations or other issue with the property; and you are buying as-is.
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