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flquestioner · May 11, 2009, 07:41 AM

Could someone point me in the right direction, please?

I have a friend who went to a foreclosure auction and paid the lien of the HOA on a condo. I told him not to but he wanted to "see what would happen."

There was a lis pendens filed by the first mortgage company. Someone said to send a release of lien letter to the first mortgage company. Will that work and what format is that?

Did he buy subject to the first mortgage? I see articles regarding what happens if the HOA forecloses, but not what happens when a third party makes the purchase.

Any help or direction would be appreciated!

ScottGem · May 11, 2009, 07:46 AM

Are you saying the HOA forced the foreclosure?

If they did then it makes sense for the mortgage company holding the first lien to file a Lis Pendens prior to filing litigation to prevent transfer of title. I can't see where a court would allow transfer when there is a primary lienholder.

flquestioner · May 11, 2009, 07:52 AM

There was a foreclosure for the HOA (which my friend paid, it is in the 10 day wait period for title to go into his name), and a lis pendens on file for the 1st mortgage.

It doesn't seem possible that it would be that easy to wipe out the 1st mortgage by paying the HOA lien. I have read that FL tacks the HOA liens back to the date of the formation of the association, giving them first position, but this is unfamiliar territory for me.

You know, a little knowledge can be a dangerous thing.

Thanks

ScottGem · May 11, 2009, 07:57 AM

I find it hard to believe that FL law would allow the HOA lien into first position. If I were a mortgage lender I would never lend in that situation. If that is the law, there must be some protection for the other lien holders.