The mortgages/trust deeds are recorded, and rank in superiority in the order/date they were filed.  

I've done a number of AP's, including getting (3) successful QTA's approved in Los Angeles County Superior Courts. 

Yes that is basically what happened since the first mortgage is superior to the HOA lien, I am now liable for the first.

IRS leins are superior to all other. 90 day right of redeption applies.Only those in subordinate positions are wiped out.

It's all about the collateralWhether it is performing or not doesn't really matter to me initially.If you are looking to buy a note secured by a first Trust Deed on a property.Look at the as is net liquidation value of the property first minus any superior liens (property taxes etc.)

Wayne,The superior lien is unaffected by a junior foreclosure.

NPV is superior in comparing investments with different attributes and does not have some of the mathematical issues of IRR.As far are performance reporting and investment analysis, I have always focused on IRR, Profit (and undiscounted measure of cash in less cash out) and Multiples (of equity). 

There are many satisfied customers who can attest to their superior service, present company included.These are the metrics I usually search when using the site:Owner Equity - 30% or moreAge of Occupant - 45+Years Owned - 5+ yearsProperty Type - 1-4 unitsExclude Corporate OwnedExclude Trust OwnedOwnership Type - Absentee.

The downside is that someone else is managing the investment for you, so you have to feel comfortable taking a manager that you trust.In my opinion, neither is superior to the other in all circumstances, and the best solution is to be able to do both.

If you managed to get your purchase and rehab done for 60k they would apply the 70k loan first against any superior leans to wipe them out, charge you closing costs and cut a check for the remaining cash.Note some lenders require a seasoning period as well...