Posted on: 10th Mar, 2011 01:06 pm
Senario: 1st mortgage $80,000.00; 2nd mtg $40,000.00. 2nd mtg holder forecloses through Sheriff sale and gets subsequent sheriff's deed that is not redeemed. Original mortgagor to 1st and 2nd mortgage continues living in the home and paying 1st mortgage/property taxes & homeowners insurance for 2 years + beyond redemption period of 2nd mortgage foreclosure. Then stops paying 1st mortgage payments. The bank (sheriff deed holder) does an eviction to the original mortgagor. Can sheriff's deed holder evict? Is the bank (sheriff deed holder) the owner of the property? Do they stand in the position of the original owner subject to the 1st mortgage? The story continues. The 1st mortgage then foreclosures and gets subsequent sheriff's deed, and then is redeemed by the bank who holds the 1st sheriff's deed. Did they have the right to redeem or is the redemption rights to the original mortgagor and 1st lien holder.
Hi catcin,
If the property has been sold off, then the lender can evict the owner of the property by sending him/her an eviction notice. If you state laws allows redemption of the mortgage, then they can go for it.
Thanks
If the property has been sold off, then the lender can evict the owner of the property by sending him/her an eviction notice. If you state laws allows redemption of the mortgage, then they can go for it.
Thanks
Not sure what you mean sold off. The lender of the 2nd mortgage (NWB)that foreclosed did the eviction notice prior to the 1st mortgage that just foreclosed. NWB got the sheriff's deed (no 3rd party). Would they be the owner and the original mortgagor be out of ownership or any ownership interest or do they still hold an interest because of the 1st mortgage?
Welcome catcin,
If the property has been sold off, the original borrower won't have any interest in the property. If the first mortgage has not been paid off, then the lender will come after the borrower in order to recover its dues.
If the property has been sold off, the original borrower won't have any interest in the property. If the first mortgage has not been paid off, then the lender will come after the borrower in order to recover its dues.
How can the 2nd do a foreclosure without paying off the 1st lein holder? Does not the 1st lein holder have priorty after a house is foreclosed on?
hi randolu,
it is true that if a second mortgage lender forecloses the property, he will have to pay off the first mortgage lender in full. it is due to this reason that the second mortgage lenders normally don't foreclose the property. they charge off the loan and assign it to a collection agency.
it is true that if a second mortgage lender forecloses the property, he will have to pay off the first mortgage lender in full. it is due to this reason that the second mortgage lenders normally don't foreclose the property. they charge off the loan and assign it to a collection agency.