Posted on: 10th Aug, 2010 08:55 pm
please help explain this to me. i am told that if i default on the second mortgage it will lead to foreclosure on my first mortgage. i refinanced my condo with a 90/10 with bofa and it is worth 40% of what i owe on the mortgage. i have another property that i actually have equity in and don't want to lose. i have tried to modify my loan with no success and was told that if it comes to foreclosure the best is to default on second not first. somehow the first loan will then also be foreclosed own but that loan will go if they take the condo. is this true? all so confusing.
Hi Guest,
The second lender has the right to foreclose the property if you do not pay the mortgage dues on time. However, if the second lender does so, then he will have to satisfy the dues of the first lender prior to satisfying his own dues. Thus, in most cases, the second mortgage lender does not foreclose the property. Rather, he charges off the loan and assigns it to a collection agency who will contact you for the balance dues.
Take care.
The second lender has the right to foreclose the property if you do not pay the mortgage dues on time. However, if the second lender does so, then he will have to satisfy the dues of the first lender prior to satisfying his own dues. Thus, in most cases, the second mortgage lender does not foreclose the property. Rather, he charges off the loan and assigns it to a collection agency who will contact you for the balance dues.
Take care.