A successful bidder at a real estate tax sale, with a new tax deed, if liens are on the title, what then?

If a bank somewhere has a mortgage on it (the property is in Pennsylvania) will (or can) they then start foreclosure proceedings against me if I don't qualify to assume the former owner's mortgage?

Answer:
They can, but they'll bend over backwards to accomodate you if they see any chance at all of getting paid. Foreclosure is an expensive, risky and time-consuming endeavor for a bank. They like money more than houses.
Congrats on entering the wide world of tax sales. The tax obligations of the county or city where the property was located was put up for auction and you are the high bidder. The high bidder is either awarded a deed (ownership) by the municipality conducting the sale or a tax certificate. If you have a tax deed then all liens except any liens of the Federal government will be wiped out. Federal liens include HUD, IRS, SBA, VA, etc. Other mortgages which are not Federal liens will be wiped out in a tax deed state. I believe that Pennsylvannia is a certificate state which means you have step into the shoes of the tax collector and you have to proceed with an in rem foreclosure in order to get a deed. You have to essentially file suit against the owners, if they are in the house then they should be serve otherwise you have to follow the procedures outline for service in the state code. Once they are served, you also need to do a title search to see what other lien or other interest exist. The exist lenders need to be served a copy of the lawsuit. After that is done and presuming no one comes forward to pay the outstanding taxes then you will be awarded a deed to the property and all other liens, except Federal Liens will be wiped out. If there are Federal Liens on the property, you will be taken the property "subject to".

Now the mortgage company, if there payments are not current could start foreclosure proceedings in order to clear title. Most of the time if a foreclosure proceeding on a mortgage occurs, the purchaser at forclosure auction will pay the outstanding taxes in order to get a clear title.

This is a confusing issue and I hope you take time to study this.

You may try a couple of books. Ted Thomas in FLorida is a real estate investor who has an extensive system on tax sales. Also check you state code and an attorney familiar with tax sales.

Good Luck

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