problem with Sheriff Sales in PA, any advice?

Question

I bought a property at Sheriff Sales 2 weeks ago and just found out this week that there are liens on it.  I have no experience in this and now I'm stressing out.  Basically, I was informed that the property went through 3 mortgages and the 3rd mortgage company put it up for sale.  My question now is what do I have to do with the 1st and 2nd mortgage?  Does this mean that I have to pay more to satisfy the 1st and 2nd loan?  Anybody have experienced this issue before who could shed some lights?

Nicole Michael · Answer

Thank you so much for the info!  This is a big lesson learned for me.  At this point I'm just praying that things would work out.  I'm seeking attorney's help.

Christopher Phillips · Answer

@Nicole Michael

You should always perform a title search before the auction. Liens often come with auction property, and the homes are usually occupied. Every auction type (bank foreclosure vs. tax sale) has different a set of rules and results.

You have a more complicated problem because the 1st position lien wasn't the one that foreclosed.

Normally, you do a title search before the auction. Contact the lien holders in advance of the auction to see if they would be willing to negotiate and at what amount so you can factor that into how much you're willing to bid. Ideally, you get the settlement amount in writing.

If you win at the auction and find liens you weren't expecting, you have to contact each one and negotiate a settlement.

Each type of lien needs to be treated differently. Some liens you just wait out. Others you have to deal with.

The other problem you'll have is that it's hard to get title insurance on a Sheriff auction property in PA due to the history of title issues in the state.