Question : How will a foreclosure work with a second mortgage?
Mortgage company put us into foreclosure on the 1st because of being behind in the escrow but there is a second on the house, with the same company. How does that work?
- asked by Missi B
All Answers:
Answer #1
Give the bank the key and RUN !!!!!!!
- answered by Thomas M
Answer #2
That's rotten eggs ... you're saying you're inforeclosure for not paying your escrow (taxes andinsurance)?Have you talked to the company to findout if they are willing to restructure everything?
- answered by J A
Answer #3
The first mortgage is probably non-recourse. Thesecond is probably recourse.Recourse means theycan sue you for the difference and even if theycancel the debt, it may be taxable income toyou.See IRS pub 4681.
- answered by v b
Answer #4
Completed Foreclosure of First mortgage wipes outsecond and other junior liens. TALK to lender onFirst and try to cure your default. IT'sEXTREMELY rare for lender nowadays to put you inforeclosure for being behind on escrow. This iscurable situation. It may be an opportunity to doa loan modification on first or second mortgage,changing to lower interest rate. This is mostlikely if you have some equity in home, haveadequate income and good payment history.
- answered by chatsplas
Answer #5
Missi, the second mortgage will always get wipedout by the first mortgage. The process inforeclosures is whatever the sales price is allthe proceeds are given to the first mortgage andthen whatever left is given to the second. Hereare a few examples that might help explain better. First mortgage 150,000 Second Mortgage 30,000Foreclosure sells for 160,000. In this situationthe first mortgage is paid off and 10,000 will goto the second.Another example is 150,000 SecondMortgage 30,000 Foreclosure sells for 90,000. First mortgage gets 90,000 second gets 0.Eventhough they are with the same company the secondwill get handled the same
- answered by Allison W
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