In order to confirm this there is a lot of paperwork to be completed and an appraisal needs to be done.how did the IRS lien become senior to the loan.. that would be quite rare  IE a lender making a loan junior to the IRS.if it fact the foreclosing loan is senior which is the case 99% of the time..

If everything was done correctly then the junior lien holder should be wiped off from title.Bear in mind all federal state, and municipal taxes automatically become superior liens to the 1st mortgage and won't be wiped out in a foreclosure.

Would it not be in the 1st line holder's interest to pay off that small junior lien to allow the short sale to go through?

It's better to fund the entire deal and be able to forclose on the property, than lend $10k on a junior lien and potentially loose it without recourse.

AB-68 is a recent CA bill (goes into affect Jan 1) that basically allows an Accessory Dwelling Unit (ADU) and Junior ADU (JADU) be added to virtually ant SFR in the state of CA.  

Also you will need to find out if their are junior liens on the property and/or any other liens-property tax, code violations, IRS liens, mechanics liens etc.

There is a property I'm interested in purchasing from Auction.From my research, here's what I was as able to gather:Senior Lien for $172,000 from 4/15/05 assigned to Bank of NY Mellon on 12/31/17.Junior Lien for $27,000 from 10/18/05 assigned to Bank of NY Mellon on 10/28/15.Bank of NY Mellon is foreclosing on the Junior Lien and it's being auctioned at the end of the month.

I am currently a junior in college studying mechanical engineering.

@Michael Junior  Use your county public records and find their name and then use their name to locate their phone #, FB/Instagram profile, linkedin, ect

I’m 16 and I’m a junior at Howell high school in Michigan.