Posted by Steve-Atl on June 19, 2000 at 12:51:43:
The rules probably vary state to state so check yours, but here in GA, if the first opens the bid and no one bids higher, the first gets clear title to the property and all junior liens are wiped out. If you bid higher and are successful, you get the property and all junior liens are gone.
Every dollar that is bid above the opening bid goes to the second mortgage holder up to the point the second is redeemed. Above that, if no other liens exist, every extra dollar goes to the borrower.
So, you can see there is great chance the second will be wiped out, especially if the first is a relatively high LTV. That is why you have a good chance of getting a discount on an assignment.