Basically any junior lien can pay off the senior lien including any interest, costs, attorneys' fees, etc to "buy them out".  

Yes- the junior  liens very often will allow a "short sale" to satisfy the lien ( depends on whether Auction.com is doing the crying), you must buy Title insurance to make certain the title is clear.That said, here is what happens at the auction.

Folks will think they are bidding on a property’s first position when in fact they are bidding on a junior lien and in fact will not own anything except a non performing note.

Often this kind of spread is indicative of a junior lien.I've tried a couple of times to approach owners in pre-foreclosure - without success - I'm always nervous someone is going to pull a pistol on me. 

I fell in love with a girl in high school, folks moved again when I was a junior, I stayed and ended up living in my $75 car some of that time and off the kindness of good people who would give me work. 

Preferred equity on the other hand is a type of “hybrid” debt/equity, it’s less secure than both junior and senior debt but more secure than common equity.

Then there's the issue of junior liens, HOA dues and liens against the sellers that the sr. lender won't pay.  

I began taking classes my junior year in high school while juggling school and varsity soccer.I sold my first house for $580,000 just a month after graduating high school at 18 years old.

My junior and senior year of college I was an agent, it wasn't overly lucrative but great beer money.

I am currently working as a Junior Broker in Arizona for NAI Horizon focusing on Mobile Home Park and RV Park Investments.