Lien Of Property In Forclosure
If you have a lien on property and then it goes into forclosure, does the lien get paid off?
If you have a lien on property and then it goes into forclosure, does the lien get paid off?
ibrahim--(CA)--------------------
Assuming you are talking about CA property, the answer is no.
If the property actually goes through foreclosure, the lien is wiped off the property, provided that the lien is junior to the foreclosing obligation, which I assume it is. However, if there is significant bidding at the foreclosure sale, it is possible that there will be "excess proceeds" left over after paying off the foreclosing obligation, in which case the junior lienholders will be entitled to that money in the order of their priority, up to the amount of excess proceeds. If your's is the only lien and the bidding gets up high enough to pay off the foreclosing obligation and you, you will be paid off.
If the property is not bid up at the foreclosure sale, you will get nothing.
If your obligation is senior to the foreclosing obligation, your lien will remain undisturbed on the property, the obligation of whoever buys the property at the foreclosure sale.
If the foreclosure is stopped because the owner brings the loan current, then the situation remains static: just as if there had been no foreclosure sale scheduled. You lien is still on the property, the formerly foreclosing lien is now not in default and is on the property still, as well as other obligations remaining undisturbed.
By the way, you have posted this quesiton on a forum that is specialized in tax lien investing and tax sale investing. I suggest you be more careful in the future to post on a forum where many people may know the answer to your question.
Good Investing***********Ron Starr***********
ibrahim--(CA)--------------------
Assuming you are talking about CA property, the answer is no.
If the property actually goes through foreclosure, the lien is wiped off the property, provided that the lien is junior to the foreclosing obligation, which I assume it is. However, if there is significant bidding at the foreclosure sale, it is possible that there will be "excess proceeds" left over after paying off the foreclosing obligation, in which case the junior lienholders will be entitled to that money in the order of their priority, up to the amount of excess proceeds. If your's is the only lien and the bidding gets up high enough to pay off the foreclosing obligation and you, you will be paid off.
If the property is not bid up at the foreclosure sale, you will get nothing.
If your obligation is senior to the foreclosing obligation, your lien will remain undisturbed on the property, the obligation of whoever buys the property at the foreclosure sale.
If the foreclosure is stopped because the owner brings the loan current, then the situation remains static: just as if there had been no foreclosure sale scheduled. You lien is still on the property, the formerly foreclosing lien is now not in default and is on the property still, as well as other obligations remaining undisturbed.
By the way, you have posted this quesiton on a forum that is specialized in tax lien investing and tax sale investing. I suggest you be more careful in the future to post on a forum where many people may know the answer to your question.
Good Investing***********Ron Starr***********