Please Help!!!!!!!! Time Is Running Out!!
I am in the process of purchasing a property. This property has an unfinished addition. Total payoff balance on 1st, second, and 3rd mortgages equal 108k. It will take aprox. 25k to finish. ARV of 200k. I recently found 60k in liens attachedto the property. Most of the liens are judgments against the owner for construction on other properties. This house goes to auction in a few days. My question is, if this house goes to auction, what happens to the liens? If the house sold at auction for 100k, that would be just enough to pay off the 1st. Do the liens go away? I know that the 2nd and third mortgages will. I guess my main question is, If we buy this for 100k+ at auction, will we get a clear title?
It depends on how your state treats contractors and materialmen. Check your mechanics' lien statutes ... they vary from state to state and year to year, since this is a hotly contested area of state law and legislatures are always tinkering due to the influence of the opposing lobbies.
if the other leinholders were notified, then they will drop off. you can also buy through your title insurance(mechanics lien coverage), of course it is extra.
i would still consult with an realestate attny, but i am sure that is how it works.