Regarding squatter's rights who has the right to property that has been maintained for years in a foreclosure sale?

Answer 1

"Squatters" are a misunderstood group. Generally, in the United States they have no rights. They are trespassers during their period of trespass. They are people who use and improve another person's land openly and without permission. If the owner allows the situation to extend for a period of years (that period varies from state to state) they can file an action for "adverse possession" and obtain title to the premises. Until they do that and succeed they have no rights. The procedure varies in different states.

It sounds as though the party who maintained the property for years had someone's permission to do so. In that case they would not be considered "squatters". If they had an agreement to maintain the property while living there then they could sue the other party if they breached the agreement. However, they are using the property subject to the mortgage that the owner granted to a bank. The bank has the right to take possession of the property by a foreclosure. It can sell the property and apply the proceeds toward the unpaid balance on the mortgage.

Answer 2

In a foreclosure sale, the property would typically be sold to satisfy the debt owed to the lender. The previous owner, including squatters, generally do not have a legal claim to the property if they do not hold title or a valid lease agreement. The new owner from the foreclosure sale would have the rights to the property.