What happens if junior lienholders are mistakenly or inadvertently omitted from the foreclosure proceedings?
It is not uncommon to discover, after completion of a foreclosure, that an existing junior lienholder has been overlooked or otherwise not joined in the foreclosure proceedings. The purchaser of the property at the foreclosure sale may enforce the rights of the mortgagee against the junior lienholder to the extent that such rights could have been enforced in the original foreclosure. The purchaser is not required, however, to reforeclose and have a new foreclosure sale held. Instead, the purchaser may sue to compel the junior lienholder to redeem within a reasonable time. The purchaser of property at a foreclosure sale may enforce rights against tenants who were omitted from the initial foreclosure by reforeclosing on such tenants.
