OK-i have a first and a second mortgage..and i am going into foreclosure on the first.Does the 2nd go with it?
Question:
help..
Answer:
The 2nd mortgage usually doesn't bother foreclosing because they are required to buy the 1st mortgage in order to start foreclosure proceedings. Also, they will likely not see any money from the sale of your home anyway since the 1st mortgage will sell it for as much as possible to pay off their lien only.
You will still be responsible for the debt even after your home is foreclosed. It may show up on your credit and you may receive a 1099 for income. If you file a Chapter 7 bankruptcy, you won't be responsible for the debt anymore if you get a discharge.
Doesn't go away; just isn't secured by the property any longer. If after the sale, there is more than enough to pay off the 1st and costs, the balance will go toward the 2nd lien position; so if you don't have judgements outstanding and a small 2nd with a lot of equity, you might not want to file.
Any leins on a home go together. Did you alraedy try to add them together for a lower payment or is it tooo late. Also chapter 13 your best bet if you ever what credit again someday.
Good luck.
The second mortgage may not actually sue you for foreclosure, just because the first is. They may wait until the sheriff sale of the property to determine if the property sells for a sufficient amount to pay back their lien. But the property will be sold at auction and the first mortgage will be paid back first, and then any proceeds left over will go to the second mortgage.
Bankruptcy would put the foreclosure process on hold and let you get caught up on the amount that you are behind, but you'd have to make the repayment plan payments, plus your regular monthly mortgage payments. This can get expensive so make sure that you can afford the bankruptcy, since if you fall behind on that, you still won't be protected from either mortgage foreclosing on you.
But typically, the second mortgage will do whatever they can to prevent the foreclosure, including accepting less than the original amount they were owed. This is because properties sell for very little at sheriff sales, so the second mortgage company can get nothing for the lien, and the lien is wiped off of the property. So it's in their best interests to negotiate with you.
Hope that helps.
ForeclosureFish
http://www.foreclosurefish.com/...
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