Legal Question in Real Estate Law in California

Your post is a little confusing. In California, transfer of a note also transfers with it the security. But it is not clear when you bought the note. If the investment group already foreclosed, before you purchased it, then the note is pretty much worthless. That's because the debt was extinguished by the foreclosure, since a lender cannot sue for a deficiency once a trustee's sale has been held by virtue of Code of Civil Procedure section 580d. At that point, the investment group would have been owners of the property, and a deed would have been required to transfer any interest to you.

If the note was transfered to you, prior to foreclosure, then the investment group had no right to foreclose. A transfer of a promissory note without the security is meaningless, since the security follows the debt. You would have had the right to foreclose, and would be the owner of the property subject to the first. In that case, you would be entitled to deal with the first.