Couple questions from first time buyer

[Richard A.]

I am looking at the first home to do a flip. The ones that I am looking at are at the courthouse auction on July 4th. My plan is to go to the June auction that is this coming Tuesday so I can get an idea of how they work. I plan on going through the houses that will be going up for auction this coming week and trying to determine what I think they should go for based on the comps, guesses on the condition from google street view, and what if I can tell is left on the note. Also, doing searches on the title information on the county web site. What I hope to do is determine how far off my estimates are from how they actually pan out. That will let me know if what I am looking at for the July auction is actually plausible.

Had two questions I wanted to throw out as I haven't seen definitive answers on these.

1. The property that I am looking at has a lien from the City of Plano. Seems that the previous owner had gone through a first time home owners program sponsored through the city and gotten $10k towards her closing costs. In getting this grant, she agreed to live in the property for 15 years, or pay back the $10k. I found information on the program on the city web site. At least as it stands today, the wording is very specific that this is a second lien. If I understand correctly, if someone bids on and wins the first lien on the house, then all liens after that one get wiped out, even if the bidding doesn't go high enough to satisfy the first and second lien. This is really a two part question, first, is my understanding correct? Would this lien be wiped out if it is a second lien? The second part of the question would be, how can I confirm that this is indeed a subordinate lien to the primary mortgage lien?

2. The property is actually a townhouse and has a fairly steep HOA fee of $157 per month. While I don't have an issue rolling that into my carrying cost while I reno and sell the property, what happens to the fees that may be in arrears? Right now, I don't see any liens from the HOA on the property. What I am afraid of is if I buy the lien and get the property, that the HOA will want me to pay all the back HOA fees or worse, wait until after the auction and place a new lien on the property for any back HOA fees.

I might be overthinking this but as my first flip or really even purchase of a home besides my primary residence I am worried about every potential issue.