Legal Question in Real Estate Law in California

Re: Who is the senior lien holder in a Trustee's Sale?

Correct.

Re: Who is the senior lien holder in a Trustee's Sale?

Incorrect. You could owe the second a deficiency. A deficiency would be calculated as the difference between the "market value" of the property and what is owed on both loans. So, if your home is worth $300,000, and you owe $200k on the 1st and $150k on the second, after buying the house at a foreclosure sale, you would still owe the 2d $50k. It is irrelevant what price the house sells for at the foreclosure sale. Also any bid made over and above what is paid to the 1st would go to the second. Also, it is possible the 2d could argue in the lawsuit it files against you that there has been a merger of title, and it would be inequitable to allow you to walk away with what amounts to a windfall. I am curious. If you have enough cash to pay off WMU in full why don't you just reinstate (cure the default) and invest the rest? WMU is the Senior lienholder.

Re: Who is the senior lien holder in a Trustee's Sale?

Seniority is not lost when the note is sold. Any modification of the terms might cause a loss of seniority, but not merely a change in beneficiary (or of trustee, for that matter).

Whether you need to be concerned about BOA is doubtful, but as a very cautious attorney who has had no chance to examine the documents I'm only going so far as to say the sale will probably result in your getting a "clean" trustee's deed and insurable title. A sophisticated bidder might want to work with a title insurer on these aspects.