Buying a foreclosure with multiple liens

[skb63001]

My husband and I planning on bidding on a property located in Ohio in a few weeks. The only probem is that the property has 5 leins on it. One is to the previous owner for about $2500, the second belonging to a bank is the largest at about $75,000, the third is to another mortgager about $8,000, the fourth is to a credit card company for about $1200, and the final is to the township for mowing.

Now this is my question, does a Sheriff sale whip put all this debt? Or would we become responsible for the leftover debt if we win the bidding?

I quess that we are lucky because we have been in the house and know its potential. Also, we have been is discussion with the current owner and she is trying to help us as much as possible as she is not interested in the property.

I am concerned that we are going to be stuck with a lot of debt if the bidding does not go high enough?

Also what about the back taxes and closeing cost?

PLEASE HELP!!

[seniorjudge]

Generally, the foreclosure of the senior lien wipes out all junior liens.

If, for example, there was a mortgage in the year 2000 and a whole bunch of liens happened after that, then when the mortgage got foreclosed upon, it would wipe out the junior liens.

What you need is a foreclosure title report from a title company that does business in the county where the place is located.

That will help you determine what is going to happen.

Taxes are never wiped out in foreclosures (that's the general rule).

And closing costs, if you buy the place, will be yours to pay.

You need to do lots of research on this to make sure you don't throw your money away.

[aaron]

Take a look at this article on real estate foreclosures in Ohio, which probably has a lot of information you will find useful. Here's a brief excerpt:

All lienholders revealed by a title search of the property should be joined as parties in order that the property is sold free and clear from all encumbrances. However, property may be sold at foreclosure subject to a prior lien (see R.C. § 2329.20). In fact, a prior lienholder may require that the property be sold subject to its mortgage. Established in Metropolitan Mortgage Co. v. Nugent Furniture Co., 40 App. 301; 179 N.E. 362 (Ohio App. 1931). Upheld in 1992 in Soc. Bank & Trust Co. v. Zigterman 611 N.E.2d 477, Ohio App. 3 Dist.,1992.

Failure To Name Lienholder:

If you fail to name an interest owner, you cannot foreclose that interest. Stewart v. Johnson (1876), 30 Ohio St. 24. The junior lienholder "passes through" the foreclosure, the property remains subject to the lien and the junior lien position is improved.

[skb63001]

Thank you for you help. We have done lots of checking already. Went to a mortgage broker and hired a lawyer to do a title search. It was odd though, we noticed on the sale listing that our lawyer was listed as the attorney. Can he be working wih us as well?