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The answer is possibly yes. Under Idaho's 63-1005, the deed in the tax deed sale conveys to the winning bidder the absolute title to the land, free of all encumbrances. However, if the holder of a mortgage of record is not properly notified under Idaho law about the tax deed sale, the mortgage may still remain and not be "swept away" in the deed sale. However, most counties do a good job of serving notice to all mortgage lenders on the deed prior to sale. One may wish to inquire as to whether or not the mortgage company indeed was served notice prior to bidding.
Nothing really needs to be done once the bid is won, as it is recorded and the winning bidder becomes the new owner. Note that the former owner has a year to purchase back the property by paying off the amount owed plus a hefty interest rate - to the winning bidder.
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