Upcoming Foreclosures

if i purchase a tax foreclosure property in a county auction what happens ifit still has a mortage?

tax deliquent propertys are suppose to be free and clear... what happen if i purchase a house in a county auction thats owes 10 thousand in taxes but it still has a mortgage left on it ? wouldn't the original lender (bank) of the house intervened first before the county?

Public Comments

1. The mortgage has nothing to do with you. That's a contract between the mortgage company and the previous owner. You cannot be drawn involuntarily into that. What you pay at the auction is it, plus any outstanding liens on the property, so do a title search first because there are likely unpaid taxes and other liens on it that could surprise you, but not the mortgage.
2. You would have to pay it off to be fully encumbered as the owner. I do not think tax sales remove mortgages on the property. It all depends on the state you live in though but the way title works is that the first lien that is on there has the highest priority. All under that are subordinate. So if you have a 1st, 2nd and 3rd lien (order is done by when they are filed). Say this tax lien is in 2nd place, you buy it. The 3rd lien is eliminated but the 1st lien remains and need to be paid off for you to be the one sole owner of the property. Otherwise the 1st can still foreclosure and that creates huge problems. Every property has a different title. People should always have a title report done prior to purchasing any property especially if it is in foreclosure. There could be a lot of money you will have to shell out that would become your responsibility and you would need to know what you are getting yourself into. I know a lot of people are interested in foreclosed properties because of the influx but most people should not buy them at auctions. It is best to buy them after the bank acquires them because it is safer and you still get the deal. Absolutely banks try to keep them from going to tax sale if they see that it will effect their position and possibly eliminate their lien!!