3rd Lien Foreclosure?

The seller has mtg1 (190K) and mtg2 (30K) with countrywide. They had a lien for 9000 from a person. This note was due and seller did not have funds to pay and the note holder (3rd lien on property) filed for foreclosure. The seller did not file an answer and note holder got a default judgment.



What happens now?

If the home goes to auction and no one buys it (its worth 230-240K) does the note holder get the property? Does he have to pay the 1st and 2nd mtg?

Why would someone foreclose on a property for 9000 note?

Can the note holder stop the prop from going to auction if seller makes a payment plan with him?





[ Edited by SKrei on Date 12/09/2008 ]

Comments(6)

  • rglover5489th December, 2008

    No forclosure here. lein cant forclose or force a sell. The 9k guy is out of luck until the house sells. Thats why they put contractor and mechanics liens on property and forget it for a while.

  • SKrei9th December, 2008

    Apologies for the miscommunication
    The seller signed a "Promissory Note" for $9300 and a "Mortgage" (just confirmed this).
    So the property has 3 mortgages of 190K, 30K, 9300 (note holder)

  • rglover5489th December, 2008

    Hmmm, looks like i was incorrect about the 3rd lien, guess you learn something everyday.

    However, i still dont see any value in 3rd liens, besides family and contractor issues. I dont see why anyone would lend money on a 3rd lien, even for a high interest rate. But there must be value somewhere i guess...

  • cjmazur9th December, 2008

    I had a deal last year that that they said the were hot to close... It took until May to get a counter offer.

  • LynLinz10th December, 2008

    That helps me alot as I was contemplating what to do, putting offer in tomorrow.

    Thank you very much

  • JeffAdams11th December, 2008

    Hi there,
    it all depends on the bank and how many properties they have on their books. Go ahead and make the offer and see what happens. Here is an outstanding course a friend of mine is giving away today. Check it out, I dont think Joel will mind. Check it out:

    http://www.shortsalesuccessblueprint.com/cmd.php?af=881448

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