Super-Priority Liens

• Pages: 147-149

Super-Priority Liens

Chapter 18

147

Some defendants named in a foreclosure action have super-priority

liens (SPL), meaning that their lien is superior to the foreclosure

plaintiff’sfirst mortgage. Questions have increasingly arisen as to

whether such liens include those of homeowners’ associations

(HOA) for unpaid dues. In states where it does not, such as Florida,

an HOA can foreclose on its lien and take the property all the way

to sale, but whoever buys the property will not receive clear title

because an inferior lien cannot extinguish a superior lien. The first

mortgage lien will remain on the property, making it still subject to

foreclosure until that lien is satisfied.

Similarly,afirst mortgage lien cannot extinguish an SPL. These

superior liens often include those placed against title by the gov-

ernment; i.e., municipalities, counties, state, and federal. Examples

may include IRS liens, violations of local ordinances and county

codes, or state child support liens.

Sometimes a foreclosure mill will not only take a case to sum-

mary judgment without addressing all litigated issues in the file,

they will also fail to address SPLs against the property. Although

there is no established precedent as of yet, this could create an op-

portunity for the homeowner. If the SPL were to foreclose against

the property and the homeowner was the successful purchaser of

the property at the SPL sale, the homeowner could end up owning