The first mortgage is in foreclosure. I have a...

[Shane C]

...second on the house. I am not on the first. What Happens? I am not on the first mortgage. The other investor is not on the second mortgage. He wants me to quit claim my interest so he can put it in a trust. Will the bank call my loan on the second? How does the foreclosure on the first effect me and my loan on the second?

[casandy]

when your property is foreclosed on the first takes priority and the second will take a loss as a write off.
the foreclosure will show up on your credit.

good luck

[DBJ]

DO NOT QUIT CLAIM! GET AN ATTORNEY to help you sort this out. I would contact the mortgage company first thing tomorrow and explain the situation. See if they will work with you. If not, have the attorney you hire contact them.

[goz1111]

a quick claim will not release you or the property from the liability of the note, and yes the bank will call it in

now as stated the first note is senior to the second note called a junior, as such when the senior forecloses all liens that are junior are wiped out, this does not personally excuse you from the second note, they can call it in and request payment in full for the note, if you can not come up with the monies or other collateral , they can get a judgment and attach to assets

if you have no assets then the second may write it off or sell it to another collection for pennies on the dollar

[Melba G]

here's a site i can highly recommend for you. give it a shot!

[Garden by M]

you need a real estate atty and fast. do not quit claim your interest to him. find an investor to buy it at an auction or quick distress sale. Do not let this foreclose unless you want to ruin your credit for the next ten yrs!

[MIKE M]

I'd like to know what idiot lender allowed two people to have two separate mortgages on the same property.

You can't have two first mortgages on a property with one portfolio number (property ID for tax purposes).

A couple of things can happen:

1. The mortgage that was obtained first will be considered the first mortgage. If this mortgage goes into foreclosure the person with the second mortgage will lose the property but will still be liable for his/her loan balance, but unsecured.

2. The mortgage that came second will be a "clouded" title. People who hold clouded titles, even if secured by a mortgage, can lose their investment.

3. The two mortgage holders can be taken to court for fraud because they didn't reveal all of the facts to the lenders. The lender of a mortgage MUST be informed when a signficant change occurs to the property that they are holding as collateral for a loan ... this includes other loans on the property (such as equity lines and second mortgages).

I'm sure there are other legal ramifications. I'd get a second opinion from a different lawyer. This one sounds like s/he is just giving you the answer you want to hear. If this goes to court, a judge may very well give you a different answer all together.

[mom]

Have you tried contacting the mortgage company to see what would be needed in order to make the loan current again. Is it possible for you to come up with the money, then assume the first mortgage and tell the others to hit the road.