The secured lender always gets the option to credit bid the amount of the outstanding indebtedness, plus fees, costs, etc, at the sale. They get this right because technically, they've already spent it. Often times, when there is an arranged buyer, the secured lender will underbid to the appraised value (assuming the appraised value is less than the indebetedness) and allow the arranged buyer to purchase at sale (helps with tax issues)....and if there's a guarantor or note holder with money, the lender will then look to the borrower under the note or guarantor and attempt to collect the difference....plus fees, costs and interest of course.
Hopefully this is all good for Ballyneal.