COMPARED to the west coast were things are pretty cut and dry.IE ANY junior is extinguished at sale.. except IRS.. this includes any utls HOA Junior loans etc.only thing that stays is Ad valorum tax and IRS lien .. that sunsets in a short time. 

It's a "junior one bedroom" which is basically a studio and is 440sf.

Can you please provide some guidelines about what can wrong with REO from homesearch or auction.com I understand these are foreclosed property with all the junior liens and all judgement wiped out , am I safe to assume that ?

Either way you should be in good shape as this action will clear all the junior debt from the property.Let's say you get the property back after the auction.

The HOA is now taken care of, since the OP paid that off, and now the mortgage balance is around market value - the bank is happy to be in that sort of position when the borrower is in default these days.Reinstating the first might require you to work this with the defaulted borrowers, taking their loan "subject to".Keeping this as a rental seems to be the "avoid loss" approach, if you are into loss mitigation on your investments...As to asking whether your are bidding on a first or junior lien: In my area, foreclosures are judicial process, with attorneys handling the bidding for the plaintiffs (banks, lenders, HOA, municipalities - whoever is owed).

., negotiating a bunch of junior liens (short sale)...The length can be 90 days to 6 months in some cases.

/gov't liens, taxes, then any junior liens, then to the owner.

Quote from @Michael Junior: So I have an offer out on a flip in San Marcos CA.

Best,Junior

 I'm a junior in college majoring in Finance.