can the 2nd mortage co foreclose?

[LindaLu]

If I am behind on my second mortgage can they foreclose?  I thought I read somewhere here on the boards that it had to be the 1st mortgage co...OR can they make the 1st mortgage co foreclose because you are behind on the 2nd?  both were not reaffirmed in bankruptcy 7 but just wanting to know if this could happening...hoping not until I can get caught up on the 2nd.

thanks for any info anyone might know

[Anonymous]

I am not sure of the exact process, but yes I am pretty sure they can.  Or at least if they can't, they have some way to exert pressure on the 1st.  If you have been paying the 1st but not the 2nd there has to be a way for the second to proceed against you.

Also, FYI, whether or not the foreclose or not, any 120 day late marks appear as a foreclosure to lenders down the road (some even consider 90 days late a pre-foreclosure)..

So, long story short, I don;t believe you can rob peter to pay paul on the mortgages.  Check into some sort of loan midification or the new gov't backed refi's that were part of the stimulus and se if you can get a refi..

[Anonymous]

Our second mortgage did file foreclosure.

We were able to pull out of that one but eventually had to throw in the towel on the first anyway.

They're a bit less likely to file, especially if the home value has dropped. The primary lienholder gets their money first so often it's not in the best interest of a secondary to file.

[Anonymous]

2 things

If you have approached them about a short sale they may start thinking of foreclosing since depending on the equity situation they get more out of a foreclosure than a short sale...

If you have been ignoring them but paying your 1st on time every time, they may feel that you are just not going to pay them and could decide to start the process since the 1st will not if they are getting paid.

[LindaLu]

thanks for the info ..I didn't know that...!! it is only like $800 total for 4 months but it may be enough I guess...i sent them a payment recently but still behind..I have talked to someone in their bankruptcy dept that actually approached me about getting the reduced interest rate through the stimulus deal...haven't heard anything on it though...she said if approved they would also take the arrearages and put it back in the loan...i will call tomorrow...

thanks for the help

[MattH]

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@LindaLu wrote:

thanks for the info ..I didn't know that...!! it is only like $800 total for 4 months but it may be enough I guess...i sent them a payment recently but still behind..I have talked to someone in their bankruptcy dept that actually approached me about getting the reduced interest rate through the stimulus deal...haven't heard anything on it though...she said if approved they would also take the arrearages and put it back in the loan...i will call tomorrow...

thanks for the help

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Be aware -- and many bank employees still do not understand this -- that in order to use the new Federal mortgage rescue plan when there is a second loan on the house the second lender must be willing to subordinate their lien to the first lender, which they may not be willing to do.

Here is more about this issue:

http://www.bankrate.com/blogs/mortgages/myths-about-the-obama-plan.aspx

This article is a MUST-READ for anybody considering this plan.

[Anonymous]

Short story:

Lost job, got behind, got way behind, got job way across country.  Moved to new job.

House was foreclosed.  Paid $228K in 2006, lender-owned house sold in Jan 09 for $95K (Arizona)

Got 1099 for First Mortage, second mortgage ($45K) is now personal debt.  They are so backlogged that I must be under the radar, but BK may be in my future.

Moral of the story:  If you walk away, get a 2 year lease on rental house, talk to BK atty immediately.  You may prolong the pain if you don't.  Just my experience/opinion