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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] So 2nd can become the 1st so to speak? Posted by Eric - CA on October 18, 2001 at 11:42 AM In Reply to: Re: Lien priorites posted by Ward-CA- on October 17, 2001 at 6:36 AM Your statement below has set off bells and whistles in my head and I want to be sure I understand this. Situation to help clarify Bob takes out a 1st to buy a house on Jan 1 for $100 Bob takes out a 2nd to buy foreclosures on March 31 for $50 Bob refies the 1st to better the interest rate on June 31. In this scenario is the second now considered first priority and if the second foreclosed, the first would be wiped out? I see so many apparent refinances when I am going through the records that this would change everything. I recently passed on a 2nd foreclosure with similar circumstances. The 1st was refinanced and recorded after the 2nd that was foreclosing. A full reconveyance of the original 1st was recorded, etc. So if I have my facts right, by winning on the 2nd I could have gotten the property VERY cheaply. My thinking has been to find the date the foreclosing loan was recorded and go back in time to the original purchase date and look at everything in between that would be considered senior. I also make sure that the seller received a full reconveyance after the sale as well to be sure the loan was not assumed. What options would the first have in this situation other than bidding at the sale just like me. Do they get special treatment? : : First question is whether liens get removed by some sort of automatic function, or do I have to request they be removed after I purchase based on the junior lien theory? : : Second, this is public records information on this person. As you can see she has been busy. I am going to the recorders office tomorrow to look at them but wanted to ask Ward if these would all go away if the loan being foreclosed is that dated Sept 7, 1999 since all the others come later. : : : : 29-NOV-2000 MYERS DOROTHY A SKILJ PERO DBA NT CREDITOR : : 29-NOV-2000 MYERS DOROTHY A SKILJ MARIJA DBA NT CREDITOR : : 29-NOV-2000 MYERS DOROTHY A HOBIES ROADHOUSE NT CREDITOR : : 15-NOV-2000 MYERS DOROTHY A SKILJ PERO NT CREDITOR : : 15-NOV-2000 MYERS DOROTHY A SKILJ MARIJA NT CREDITOR : : 08-NOV-2000 MYERS DOROTHY A CIT GROUp FIN INC DEED TR/MTGE : : 18-OCT-1999 MYERS DOROTHY A SCME MTGE BANKERS INC ASGT DEED TR : : 07-SEP-1999 MYERS DOROTHY A CLARAS COVE GROUP HOMES GRANT DEED : : 07-SEP-1999 MYERS DOROTHY A SCME MTGE BANKERS INC DEED TR/MTGE : : Last... Let's someone say took out the 1st on Sept 7, 1999. : : On Dec 31, 1999 someone records a mechanics lien. : : On Jan 31, 2000 the 1st is refinanced and all recording done on the 31st. Does this action make the 1st junior to the lien which would be recorded prior to "new" 1st? : : Thanks : =•=•=•=•=•=•=•=•=•=•=•=•= : Eric, nothing gets removed in the public record—it’s there for posterity. It’s just understood the foreclosure of a senior lien acts to wipe off all the junior liens and interests caught between the recording date of the senior lien and the sale date of the recorded trustee’s deed. : In the above example, all the liens junior to the 9-7-00 trust deed would be wiped off the title record by said trust deed. : When a lien is refinanced it is paid off and replaced by a newer lien. Timewise the replacement lien takes it’s priority from when it was recorded, not when the original lien (that’s now paid off) was recorded. So if in the interim another lien is recorded, then that lien would advance in seniority to 1st position, given the payoff of the original 1st lien. Follow Ups: Re: Sure, junior liens become more senior as the senior liens are paid off. Ward-CA- 5:26 PM, 10/18/01 (0) Post a Followup: Name : E-Mail : Subject : Comments: : Your statement below has set off bells and whistles in my head and I want to be sure I understand this. : Situation to help clarify : Bob takes out a 1st to buy a house on Jan 1 for $100 : Bob takes out a 2nd to buy foreclosures on March 31 for $50 : Bob refies the 1st to better the interest rate on June 31. : In this scenario is the second now considered first priority and if the second foreclosed, the first would be wiped out? : I see so many apparent refinances when I am going through the records that this would change everything. I recently passed on a 2nd foreclosure with similar circumstances. The 1st was refinanced and recorded after the 2nd that was foreclosing. A full reconveyance of the original 1st was recorded, etc. So if I have my facts right, by winning on the 2nd I could have gotten the property VERY cheaply. : My thinking has been to find the date the foreclosing loan was recorded and go back in time to the original purchase date and look at everything in between that would be considered senior. I also make sure that the seller received a full reconveyance after the sale as well to be sure the loan was not assumed. : What options would the first have in this situation other than bidding at the sale just like me. Do they get special treatment? : : : First question is whether liens get removed by some sort of automatic function, or do I have to request they be removed after I purchase based on the junior lien theory? : : : Second, this is public records information on this person. As you can see she has been busy. I am going to the recorders office tomorrow to look at them but wanted to ask Ward if these would all go away if the loan being foreclosed is that dated Sept 7, 1999 since all the others come later. : : : : : : 29-NOV-2000 MYERS DOROTHY A SKILJ PERO DBA NT CREDITOR : : : 29-NOV-2000 MYERS DOROTHY A SKILJ MARIJA DBA NT CREDITOR : : : 29-NOV-2000 MYERS DOROTHY A HOBIES ROADHOUSE NT CREDITOR : : : 15-NOV-2000 MYERS DOROTHY A SKILJ PERO NT CREDITOR : : : 15-NOV-2000 MYERS DOROTHY A SKILJ MARIJA NT CREDITOR : : : 08-NOV-2000 MYERS DOROTHY A CIT GROUp FIN INC DEED TR/MTGE : : : 18-OCT-1999 MYERS DOROTHY A SCME MTGE BANKERS INC ASGT DEED TR : : : 07-SEP-1999 MYERS DOROTHY A CLARAS COVE GROUP HOMES GRANT DEED : : : 07-SEP-1999 MYERS DOROTHY A SCME MTGE BANKERS INC DEED TR/MTGE : : : Last... Let's someone say took out the 1st on Sept 7, 1999. : : : On Dec 31, 1999 someone records a mechanics lien. : : : On Jan 31, 2000 the 1st is refinanced and all recording done on the 31st. Does this action make the 1st junior to the lien which would be recorded prior to "new" 1st? : : : Thanks : : =•=•=•=•=•=•=•=•=•=•=•=•= : : Eric, nothing gets removed in the public record—it’s there for posterity. It’s just understood the foreclosure of a senior lien acts to wipe off all the junior liens and interests caught between the recording date of the senior lien and the sale date of the recorded trustee’s deed. : : In the above example, all the liens junior to the 9-7-00 trust deed would be wiped off the title record by said trust deed. : : When a lien is refinanced it is paid off and replaced by a newer lien. Timewise the replacement lien takes it’s priority from when it was recorded, not when the original lien (that’s now paid off) was recorded. So if in the interim another lien is recorded, then that lien would advance in seniority to 1st position, given the payoff of the original 1st lien. 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