Foreclosure auction questions - Posted by sbwells

Real Estate Investing Real Estate Law
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Posted by sbwells on July 24, 2003 at 11:46:51:

Thanks for the redirection. I didn’t see your post?

By the way if you are the same “Marcos” who authored the “how to get started in RE” article – Thanks a bunch!!!

Best regards,

SBWells

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Foreclosure auction questions - Posted by sbwells

Posted by sbwells on July 24, 2003 at 11:31:28:

A couple of questions regarding foreclosure auctions:

  1. Assuming that a house goes to auction brought by the 1st position lienholder and the winning bid exceeds the foreclosing lienholder’s judgment amount, who receives the “excess” monies?

Example #1 - Winning bid $250K
1st mortgage holder $130K
2nd mortgage holder $ 50K
3rd position judgment $ 20K

Do all lienholders get paid off and remaining $50k gets paid to homeowner?

Example #2 - Winning bid $160K
1st mortgage holder $130K
2nd mortgage holder $ 50K
3rd position judgment $ 20K

Does 1st get paid off in full and 2nd receives $30k or do 2nd and 3rd share $30k ratably?

In general, is it safe to conclude that once all lienholders are satisfied that the remaining funds get paid to the homeowner? Do “excess” funds ever get distributed to the lienholders?

  1. What is the benefit of having the winning bid at a foreclosure auction brought by a second mortgage holder or for that matter any lienholder not in 1st position?

Thanks in advance.

Sbwells (NY)

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Re: Foreclosure auction questions - Posted by Marcos

Posted by Marcos on July 24, 2003 at 11:33:55:

Check out my answers to this question on your previous post.

Marcos