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Karen's house was recently foreclosed on to pay off a lien on her home. any extra money after the lien and expenses of the sale are paid is given to karen.
Any judgment liens that were recorded after the mortgage when it goes into foreclosure will be eliminated. Any cash remaining after the obligation owed by the foreclosing lender is satisfied will be dispersed to other creditors holding junior liens, such as second mortgage holders and holders of judgment lienholders.
Example. Let's say your first mortgage has a $200,000 balance. You also have a judgment lien for $15,000 and a $40,000 second mortgage. The house is then sold at the foreclosure auction for $250,000. The first mortgage holder will receive a $200,000 full payment. The full amount of the second mortgage ($40,000) will also be repaid. Whatever is left ($10,000) will be paid to the judgment lien holder. However, if the house had only gone for $200,000 at the auction
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