Q: So that means the bank that granted the additional $455K loan after our lis pendens was filed- accepted that and are willing to take the risk of the outcome of the lawsuit? That's unusual, no bank would accept a title with a "cloud".
A: That is correct, and I agree that it is unusual. It sounds like their title review people may have made a mistake, unless the the value of the house is clearly more than the first mortgage, your claim, and the second mortgage combined.
Q: Also, how was the bank that granted the 455k loan able to grant a loan when there were superior mechanic's lien prior to the date of the acquisition of the additional 455K?
A: The answer to this is the same as before. The mechanics liens do not prevent a lender from giving a loan. It just means there are priority issues. But just as a lis pendens expires, so do mechanics liens. If the lienholder does not take action within one year, then the mechanics lien expires. Accordingly, the liens that you mention from 2013 and 2014 are gone.
Q: So in essence the subsequent lender basically accepted this risk?
A: Yes, I would say so.
Q: So, I guess the above is incorrect?
A: No, that quote you referenced is exactly correct in my opinion. That's why I wrote that it sounds like the lender made a mistake. To clarify: Can you sell the property or lend money against the property with a lis pendens? Yes, it is legally permissible. Will you be able to do so? Not likely, unless (a) a mistake was made, or (b) you find a wheeler-dealer type mentioned in the paragraph you quoted.
I hope that makes sense. Please let me know if you need further clarification, and please remember to provide positive feedback. Thank you.