The napkin thing you mention is just an unsecured loan with no security instrument providing any assurances of repayment.

I was the successful bidder on a Sheriff Sale for $48K, value around $100K the foreclosing entity is Carrington Mortgage, its a federally insured Reverse mortgage, and they record the originating mortgage, and FHA records a mortgage in the same amount ($160K in this case 150% appraised value) USA was not identified in the proceeding, does anyone know how this plays out, will the FHA instrument stick, or does it get wiped out?

Borrower shall occupy, establish, and use the Property as Borrower's principal residence within 60 days after the execution of this Security Instrument and shall continue to occupy the Property as Borrower's principal residence for at least one year after the date of occupancy, unless Lender otherwise agrees in writing, which consent shall not be unreasonably withheld, or unless extenuating circumstances exist which are beyond Borrower's control.If you breach your Mortgage, the lender can call the Note due.Hope that helps!

Hey Brent,First, So like I said, I did't have time earlier to tear it up point by point, but now I'm at home and I have a 6 pack of Fresh Squeezed and nothing but timeSecond, if you haven't seen the movie and want to, don't read this as it will be a huge spoiler.SPOILER ALERTSo yes, there are those in the movie who are shorting various CMO debt instruments.

Things you must not do You must not; i) commit an act of bankruptcy; or ii) fail to pay me on time any money you have to pay me under this contract; or iii) pay any repayment/s with a check, direct debit or other instrument that is subsequently dishonored by a bank; or iv) fail to comply with any condition of this loan contract; or v) make any material false or misleading representation.9.

Bonus if you play an instrument (I play guitar) or enjoy motorcycles:-)  Thanks - Scott

A release or partial release of lien is the only instrument that will get one released from the note

When you do a "subject to" purchase in a trust deed state wouldn't that deal send a red flag to the trustee who is the watch dog over the security instrument on behalf of the lender - thereby, triggering the "the due on sale'?

Hard money instruments are suitable for newer investors, but as issuers gain experience and a track record they're less risky.  

So in general there is a higher chance of not being able to recover at all due to being in a junior position as those senior positions claim all the available equity leaving none for juniors.Past that the complexity of collecting on notes stems from two ideas the collateral and the security instrument and note.