Hi-can anyone tell me-We bought and paid cash for a second lien in a foreclosure in Ca.(on the court house

Asked by Mark, Napa, CA Sun Jul 27, 2008

steps).We have had a different answer from everybody Title co,Realtor & Lawyer. Are we a lien holder or owner to this prop?Thank You

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Mr. M Soliman, , Los Angeles, CA
Sun Jul 27, 2008
Lien holder. You bought an asset calle a "Note" with a security which is interst in the property. Take that to the bank. That's all.
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1 vote
Don Tepper, Agent, Burke, VA
Sun Jul 27, 2008

Why did you buy a second lien without knowing what position that put you in, or even what it entitled you to?

From the way you're describing it, M Soliman is correct. And the process you might follow is described by Shel-lee.

Consult with a real estate attorney.

Good luck.
0 votes
Shel-lee Dav…, Agent, Rolling Hills Estates, CA
Sun Jul 27, 2008

This is a great question for a real estate attorney. I would be happy to recommend one if you need a referral.

Meanwhile, you should notify the 1st Trust Deed holder that you hold the second and request notification of any action they are taking against the property. Since the 2nd TD is a junior lien to the first, it would be wiped out in a foreclosure action by the 1st.

Having been an investor and working with investors, I actually know people who buy 2nd TD's on home in foreclosure (at a deep discount), bring the 1st TD current and then foreclose on the property themselves. This play only works in a situation where there is sufficient equity, but has been quite lucrative for some of these investors, especially if they can create equity by their purchase of 2nd for pennies on the dollar.

If you find out, from a real estate attorney who has reviewed all the facts of your situation, that you are a lien holder, then you will want to protect your position by knowing what is happening with the 1st TD.

Best of luck to you and Dare to Dream.

Shel-lee Davis
Real Estate Consultant
RE/MAX Palos Verdes Realty
0 votes
Homa Moaddel, Agent, Foothill Ranch, CA
Sun Jul 27, 2008
Hi Mark,

Without seeing what you have purchased it is hard to give opinion. But a lien holder become the owner if he/she can foreclose. How about the first lien holder? If the first lien holder forecloses on a property the subsequent lien holder(second and on) will be wipe out.


Broker Associates
Prudential California Realty
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