Question Re: Foreclosure And Second Mortgage

if a property is foreclsed on, and there is both a first and second mortgage, what happens?

Comments(3)

  • bargain763rd July, 2006

    If the 2nd mortgage forecloses, you buy the property subject to the 1st mortgage and any liens or judgments superior to the 2nd.

    If the 1st mortgage forecloses, you buy the property free of all encumbrances.... if it was a proper foreclosure action with a good title search and all claimants are mentioned and served as defendents.
    [addsig]

  • djmadmike4th July, 2006

    where are you located...

  • roboxking4th July, 2006

    More than likely there is probably a deficiency judgement provision in the security instrument.

    That means if the second lender feels that it is worth coming after you then they may come after you for the difference between what they are owed+cost and what they get at the auction.

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