Foreclosure 1st Lien Gave Permission to Be Moved to 2nd Position

[Bryce Davis]

I am interested in a property that has an interesting deed recording. US Bank took over 1st lien position per registered deed. The borrower took one mortgage from Fifth Third is 2008 and took another lien from US Bank in 2010. Normally you would look at the oldest lien and follow registered payoffs to ensure lien position. When researching I found a deed that moved the 1st lien to 2nd position and allowed US Bank to take 1st.

US Bank is foreclosing. When following the paper trail it seems if I won the bid at auction I would be first lien holder which would wipe out the 2nd lien. 

Has anyone dealt with a situation like this before? What should I look for? Are there any possible things I am missing?

Quote from the Deed

"The Fifth Third Bank agrees that it will postpone and make junior and subordinate in all respects that a certain mortage by Jeff Smith on May 27th, 2008 for the amount of 108k records in favor of a mortgage executed by Jeff Smith by US Bank for amount 206k. Which mortgage covers real estate described in exhibit A. 

The agreement shall continue in full force and effect so long as Jeff Smith is indebted to US Bank. "