The second mortgage may not actually sue you for foreclosure, just because the first is. They may wait until the sheriff sale of the property to determine if the property sells for a sufficient amount to pay back their lien. But the property will be sold at auction and the first mortgage will be paid back first, and then any proceeds left over will go to the second mortgage.
Bankruptcy would put the foreclosure process on hold and let you get caught up on the amount that you are behind, but you'd have to make the repayment plan payments, plus your regular monthly mortgage payments. This can get expensive so make sure that you can afford the bankruptcy, since if you fall behind on that, you still won't be protected from either mortgage foreclosing on you.
But typically, the second mortgage will do whatever they can to prevent the foreclosure, including accepting less than the original amount they were owed. This is because properties sell for very little at sheriff sales, so the second mortgage company can get nothing for the lien, and the lien is wiped off of the property. So it's in their best interests to negotiate with you.
|
Linear Mode
