Does Foreclosure wipe out the lien foreclosed on?
If a property is foreclosed on, goes to sherriff's sale and is bought by the foreclosing bank, does this wipe out the lien that the bank filed the foreclosure on?
Here's the reason that I'm asking - A property near me went to sherriff sale in June and was bought by the bank for $1. Sherriff's Deed was issued in July. Apparently the bank (which shall remain nameless at the moment) neglected to check on past due property taxes on the property and it is now listed for Upset Tax Sale this coming Monday. With an Upset Tax Sale (at least in PA), the sale is subject to existing liens, so mortgages don't get wiped out by the tax sale. So, if the bank doesn't correct the tax deficiency by Monday morning and the property is sold for the back taxes, does the first mortgage that got foreclosed on still exist?
If it doesn't exist, the property is a huge steal. If it does still exist, it probably isn't worth the lien amount.
Thanks.
Steve