Foreclosure questions?????? Please help?

Question

They sent my dad a foreclosure notice in the mail a week ago can they still foreclose on him if he owes on a 2nd mortgage???? It's a 94 mobile home and last my mom checked he was making the payment on his house when they did her credit report.

Answer 1

yes, if you have 2 mortgages (like a primary and a secondary) they would forclose, and the first mortgage gets paid off and any remainder goes onto the second mortgage.

If his credit is okay have him refinance and combine it into one mortgage ASAP before it goes all the way into foreclosure.

Answer 2

This can be done legally. It is quite unfortunate to see a lot of borrowers with their second mortgages heading for a foreclosure. Normally the difference between the sale price of the property at a foreclosure and the outstanding balance of the mortgages goes to the owner. But in many cases, the lender stays as the only bidder in the auction and he bids only the amount of the mortgage.

Once he gets the title he can sell at whatever price he is able to get. In that case you can do nothing as a borrower than losing more than your property.

A borrower should take early measures to save this loss. If the borrower can't make the payments and foreclosure seems to the only result, then he/she should sell the house and thus repay the mortgages. This will help the borrower to retain both the residual equity in the property and his/her credit rating.

Plus there's two types of foreclosures, depending on what state you are in: Judicial Foreclosure
The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, the property will be auctioned off to the highest bidder. In some states this varies, but the notice of the time and sale must be advertised once a week for three (3) consecutive weeks, with the last publication being no more than fourteen (14) and no less than seven (7) days before the scheduled date of sale. Notice of the sale must also be sent to the borrower within five (5) days of the first advertisement.

Unless otherwise ordered by the court, the sale is typically held at the courthouse of the county in which the property resides. The sale is by public auction to the highest bidder, who will receive a certificate of purchase. After the sale is confirmed, the winning bidder will be entitled to receive a sheriff's deed, which will vest good and perfect title to the foreclosure bidder, once the borrowers right of redemption has expired. The borrower typically has twelve (12) months from the date of the foreclosure sale to redeem the property.

Lenders may sue to obtain a deficiency judgment for the difference between the foreclosure sale price and the amount due on the original mortgage.

1. Judicial Foreclosure
The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, your home will be auctioned off to the highest bidder.

2. Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the "Power of Sale Foreclosure Guidelines".

Answer 3

JFAD's answer was great. I would only add that in most cases mortgagor's don't want to foreclose if there is any other option, because they rarely recover all the money they are owed, plus the expenses of foreclosing. Your dad should contact the mortgagor to set up repayment plan. The sooner he contacts them, the more likely they will cooperate.

Answer 4

Yes, the first mortgage has precedence over the 2nd mortgage, that's why the rates on 2nd mortgages are usually higher than the first.

Answer 5

Sure can! They'll take it back and sell it to pay off the first mortgage, then he'll still owe the second and whatever is left of the first after it's settled.