2ND Lien Forclosure by HOA in Texas, need help! (auction, foreclosure, mortgage)

[johnnybz]

I was wanting to get some feedback and different views to help weigh my risks and possible expenses and/or sanity.

The property was purchased on a 10-year note from Wells Fargo(1st Lien Holder), and has had current payments for roughly 5+ years.

I have done a title search, and only found a "Request For Notice" from the bank, wanting to be notified if their are any new liens/foreclosures filed. I would suspect that this is in result of non-payment of the mortgage, and might be approaching pre-foreclosure. There is not any indication of foreclosure by Wells Fargo, only a suspicion(mine) that the owner may be <6 months behind.

The HOA is now foreclosing for HOA dues and fees. They have filed liens 3 times in the last few years for non-payment, and were always satisfied. This would mark the 4th occurrence of a lien/non-payment and the owner of the property is now non-respondent to the HOA, resulting in the foreclosure notice. There are about 8-10 months of late HOA dues and fees.

If I was to go purchase the property at auction, the sale price will be used to payoff incurred HOA dues. My uncertainty intensifies here because I think I am right to say:

1. The 1st lien holder (Wells Fargo) is binding, and will not be wiped out by a 2nd lien holder position foreclosing for HOA dues.

2. There is not a tax lien, as property taxes have been paid currently up until this year.

3. If I was to purchase the property at auction, I would only be satisfying the HOA foreclosure, and I would still be responsible for paying the 1st lien/mortgage.

4. I would need to come to terms with the bank and make an agreement to pay for the remaining amount due.

The first lien holder can foreclose themselves and wipe me out, if they choose to not make a deal with me and their customer defaults. The owner is still responsible for the property living there or not, HOA foreclosure or not. I am worried based upon his payment history, and percentage of ownership whether or not the bank will even need to make a deal with me to satisfy the mortgage because they have a current paying customer (at least within a 6 month window).

so... what do I do?
What precautions should I take?
What am I missing?
Am I wasting my money?
How can I become the sole owner of the property and pay off the mortgage position?

Thanks for any help!

[2bindenver]

local real estate attorney time.

[Modification Specialist]

Originally Posted by johnnybz

....They have filed liens 3 times in the last few years for non-payment, and were always satisfied. This would mark the 4th occurrence of a lien/non-payment and the owner of the property is now non-respondent to the HOA, resulting in the foreclosure notice. There are about 8-10 months of late HOA dues and fees.....

If I was to go purchase the property at auction, the sale price will be used to payoff incurred HOA dues.......

My uncertainty intensifies here because I think I am right to say:

1. The 1st lien holder (Wells Fargo) is binding, and will not be wiped out by a 2nd lien holder position foreclosing for HOA dues.

2. There is not a tax lien, as property taxes have been paid currently up until this year.

3. If I was to purchase the property at auction, I would only be satisfying the HOA foreclosure, and I would still be responsible for paying the 1st lien/mortgage.

4. I would need to come to terms with the bank and make an agreement to pay for the remaining amount due.

The first lien holder can foreclose themselves and wipe me out, if they choose to not make a deal with me and their customer defaults. The owner is still responsible for the property living there or not, HOA foreclosure or not. I am worried based upon his payment history, and percentage of ownership whether or not the bank will even need to make a deal with me to satisfy the mortgage because they have a current paying customer (at least within a 6 month window).

What precautions should I take?
What am I missing?
Am I wasting my money?
How can I become the sole owner of the property and pay off the mortgage position?

Thanks for any help!

I bet your getting a good price on this property - even if it sounds like a good deal, I storngly caution you because you can be stuck with someone else's problems.

If you are considering buying this - you want to do a title search, with title insurance. That way past problems cannot come back and haunt you.

[johnnybz]

well the place defaulted to the HOA, I found out that the "owner" had only paid 1 year of the mortgage, and the bank was in pre-forclosure as well. Therefore it will either be for sale by the HOA soon if they buy out the mortgage, or it will be auction at a foreclosure sale soon. The uncertainty was in the amount owed on the 1st lien, and then of course how to you get a bank to talk to you anyways these days unless you owe them money. Thanks for any insight.

[gotmilk]

Johnnybiz did you ever find the answer to your question? will the 1st lien holder Wells Fargo foreclose on the property if you don't settle with them

[hugoovalle]

Would you please tell me how did this ended up??