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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Re: Sure, junior liens become more senior as the senior liens are paid off. Posted by Ward-CA- on October 18, 2001 at 5:26 PM In Reply to: So 2nd can become the 1st so to speak? posted by Eric - CA on October 18, 2001 at 11:42 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? =•=•=•=•=•=•=•=•=•=•=•=•= Eric, if the original 1st of Jan 1 is paid off and retired by the refinance of June 31st, and the loan of March 31 is left undistrubed, then the March loan becomes the new 1st and the June 31st loan is second in priority. Sometimes you will see the March loan execute a recorded subordination to the June loan so that the June loan is the most senior lien. Follow Ups: 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? : =•=•=•=•=•=•=•=•=•=•=•=•= : Eric, if the original 1st of Jan 1 is paid off and retired by the refinance of June 31st, and the loan of March 31 is left undistrubed, then the March loan becomes the new 1st and the June 31st loan is second in priority. Sometimes you will see the March loan execute a recorded subordination to the June loan so that the June loan is the most senior lien. Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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