What is the mortgage lien status in this scenario?
I'm trying to find a way to get some insight on this situation surrounding an upcoming auction property I'm very interested in. I want to know the status of the 1st mortgage lien in the following scenario in Florida:
Homeowner has a loan from PNC bank. A small Florida LLC acquires the note and forecloses because the homeowner isn't making payments. Foreclosure judgment is in favor of the LLC (from here on just "the lender" for simplicity) and the property is ordered to be sold at public auction. Nobody bids so the lender acquires title to the property. Does the completion of the foreclosure and acquisition of title by the lender extinguish the lien permanently? I ask because the following happened:
The homeowner also owed a significant amount of past-due HOA assessments. The HOA separately foreclosed on the homeowner and the foreclosure went in favor of the HOA. The property was ordered to be sold at public auction again. This was before the certificate of title was ever issued to the lender after the first auction. Nobody bids in the second auction, so the HOA wins the home, and they too are issued a certificate of title.
Two foreclosures. Two certificates of title issued to different entities as a result. The certificate was issued to the lender first and HOA second.
Lender and HOA argue back and forth for a few months over ownership of the property and eventually sign an agreement whereby the lender would pay $15,000 to the HOA for past-due assessments and the HOA would release its title claim via quitclaim deed or some other instrument. The only problem is the lender never made a payment to the HOA, per court filings. HOA forecloses on the lender as the owner of the house. The upcoming auction is the one I'm interested in.
I want to be sure I understand the process here. If the 1st mortgage lien is extinguished when the lender acquired title, can the lien reattach to the property if the lender loses title via foreclosure?
Basically, could I still be on the hook to satisfy the original 1st mortgage lien in this scenario?
Thanks BP! Looking forward to hearing what people think or if anybody has seen this situation before.