What happens to my 2nd mortgage during a forcloser?

i asked a similar question earlier but looking to find out what happens with my second equity mortgage with a forclosure? we plan on telling our primary mortgage company that we cant afford it anymore and we are either gonna sell our home or do a short sale. but what happens with the second mortgage that we got with the equity on the house? should we do the same thing and just tell them we cant pay it anymore?What happens to my 2nd mortgage during a forcloser?
What is likely to happen is the first will foreclose and the second sue for the decency you owe them. The first may as well, it depends on several factors.What happens to my 2nd mortgage during a forcloser?
You are better off telling the second mortgage holder you are having trouble paying it. I would write them a letter of hardship explaining your situation. And pay what you can.





Either the first or second mortgage holder can take the home in to foreclosure if their loan is delinquent. At the foreclosure sale, the second mortgage holder can buy the property from the first. That does not usually happen though. Most likely the bank will acquire the property and turn around and try to sell it.





If you do a short sale, usually both mortgage companies have to agree to do it and must agree on the final sales price. If you cannot sell the house for more than is owed, you may be liable for the remaining balance (as an unsecured loan).



If you do a short sale, both first mortgagor and second mortgagor will have to agree to the sales price and what % they get paid back.





If you foreclose, the first mortgage gets their money and leftovers go to the second lender.





If your home isn't worth enough to cover both of them, you may be responsbile to pay the bank the difference. If you don't pay they could take legal action to get the money back from you that you signed stating you'd pay back.





Either way your credit is ruined for at least 5-7 years so hopefully you don't need a car loan, school loan, or credit card within that time period.
Tell them. IF the 2nd forecloses, they get the house but they must pay the payments to the 1st. That's why they never take the house. If the 1st takes the house, the 2nd is wiped out. They have the legal right to go after you for the money but they seldom do. But they can.