Pre-foreclosure Work With Banks
I'm trying to work out a deal with a homeowner in pre-foreclosure. The lis pendens is on the first mortgage. There is a second mortgage (for much less than the first). Does anyone have any experience/words of wisdom in working out a deal with the bank of the second mortgage. In this case, the 2nd mortgage bank will probably lose all when it goes to auction. 
You need to negotiate the second mortgage down as low as possible (10% of amount owed). Once you've done that, call the first lien-holder and tell them that the second position settled for $x and ask if they'll do the same. They'll probably scoff at your request. Then in a day or two, they may call you back and agree.
Lots of luck. Buy short
I will agree in part that you will need to work out a financial settlement with the second mortgage holder but I would not recommend telling the first mortgage holder of the settlement amount as it serves no purpose.
I also would not recommend making such a low offer to the 1st mortgage holder such as what was suggested as the likelihood of a 1st mortgage holder knocking off 90% is a little ridicules.
You want to be seen as professional!
[addsig]
I agree with the last poster. Build your equity in the deal with the second. The first most likely won't deal because of the position. Definitely don't tell the 1st about you buying the second or there won't be a chance of them accepting anything.
I would recommend buying the note completely not short sale. If you are trying to help the H.O out that would be in their best interest.
What are the numbers on this deal?