What now? Pre-foreclosure - Posted by Kristy-AZ
Posted by Kristy-AZ on July 09, 2003 at 09:04:05:
Awhile back we were working with some friends to get them out of foreclosure. The 2nd was foreclosing and wouldn’t consider a short sale.
It went to auction, and went to the 2nd for what was owed. Now they are not making the payments to the first and the first is foreclosing.
If we were to bid on this at auction, does the 2nd still stay in place since it now has the deed? Or does it get wiped out?
House FMV = $145K
1st = $107K
2nd = $ 37K (2nd thought the house was worth $180K when we tried to work with them, guess they found out different)
Originally the 2nd balance was only $25K, the note was sold to an investor, who started the first foreclosure thinking he was going to get a “Hot” property. This investor lives out of state and has no idea of the values here. Now after foreclosing on the house, he has not made any payments to the 1st who has now started their foreclosure process. PLUS!! this house has an enormous IRS tax lien on it.
So my question is, what is going to happen to the 2nd if this house goes to auction again, by the first mortgage holder??