Implications of Buying HELOC in 2nd Position

[Brendan Couture]

Looking for some help. I'm looking at buying a secondary lien (HELOC) via foreclosure auction.

Would I then have the right to pay off the first lien and own the property outright? That would be my goal.

The owners have a recent loan modification on the primary lien claiming hardship, but not sure that would matter if I own the secondary?

Any help would be greatly appreciated!

[Chad U.]

Quote from @Brendan Couture:

Looking for some help. I'm looking at buying a secondary lien (HELOC) via foreclosure auction.

Would I then have the right to pay off the first lien and own the property outright? That would be my goal.

The owners have a recent loan modification on the primary lien claiming hardship, but not sure that would matter if I own the secondary?

Any help would be greatly appreciated!

As long as there is equity above the combined 1st payoff and 2nd payoff (CLTV) you should be OK. I would have an attorney review the collateral and foreclosure file to ensure everything is legit heading into the sale. The only issue is you won't likely know the payoff balance of the 1st, so make sure there's tons of equity.

 BTW, tax liens take precedence over 2nd AND 1sts as well, so check those as well as any involuntary liens, municipal liens etc