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.

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.

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. 

It was 180 redemption period for the other junior liens to redeem but taxes were protected.

I have a son in college (just started his junior year) and I bought a house for him and his friends to live in.

@Christopher WinklerI am no expert in this area as my focus is on 1st liens, however, my understanding is that the lien portion of secured junior debt can be stripped in a BK case, rendering the debt as unsecured.

Hello BP,My name is Ryan and I'm currently a Junior in college.

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

It's not like CA sale buyers don't bid on junior liens.