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Delores Said:

When is the first repayment due on a new mortgage?

We Answered:

6 months

Harvey Said:

Does a Certificate of Title issued at Foreclosure guarantee a free and clear title?

We Answered:

No. A foreclosure does not convey clear title. A buyer at foreclosure obtains property that is free of all liens that are JUNIOR to the lien that is foreclosed. Anything SENIOR to the lien that is foreclosed will remain.

So, for instance, let's say this is the chronology of events:
1. Owner grants driveway easement.
2. Buyer buys property; secures $100,000 1st mortgage.
3. Buyer obtains 2nd mortgage of $30,000
4. Buyer defaults on 2nd mortgage; 2nd mortgage is foreclosed.

In this scenario, the buer at the foreclosure sale will obtain a property that is encumbered with the $100,000 1st mortgage and the easement.

But, if the 1st mortgage is foreclosed, then the foreclosure sale buyer gets the home free of all encumbrances, except the driveway easement. The $30,000 is junior (later in time) than the 1st mortgage, so that loan, being junior, is wiped out with respect to the foreclosure buyer.