Unless the property goes through foreclosure auction and becomes bank-owned, outstanding liens and fees are simply transferred to the new owner.

FORBES: Magazine Article

The former heavyweight boxing champion, who has fallen on hard times due to failed business ventures, two divorces and hefty six-figure annual child support bills, recently lost his mega-mansion in a foreclosure auction.

FORBES: Foreclosure Woes Of The Rich And Famous

The auction drew about 1, 400 people, twice as large as the crowd last year, when the California-based Real Estate Disposition Corporation held its first foreclosure auction in New York City, according to The New York Times.

CNN: For one man, foreclosure is a shot at his housing dream

Mr. LAPPE: Purchasing at a foreclosure auction today is probably much less of a deal than it was a year ago or two years ago, because previously, with credit standards being fairly loose, an investor who bought a property to foreclosure sale stood a pretty good chance of finding a qualified buyer to sell the property to.

NPR: Housing Auctions Surge as Foreclosures Mount

This is when a borrower negotiates with his lender to sell his home at a loss, taking a bet that home prices will further depreciate and that a short sale will bring in more cash for the lender than would a foreclosure and auction.

FORBES: Magazine Article

There were nearly 650, 000 foreclosure filings -- which include notices of default, auction sales and bank repossessions -- issued during the first quarter of 2008.

CNN: Report: Ed McMahon's home faces foreclosure

The potential buyers at this auction are regulars, speculators who travel almost pack-like from each of the foreclosure auctions that are held throughout the day.

NPR: Housing Auctions Surge as Foreclosures Mount

Foreclosure filings declined only slightly last year, but the counselling service saved over 4, 000 homes from the auction block.

ECONOMIST: But Western libertarianism is no help at all