When 1st Forecloses, What Happens To 2nd?
Hello,
A friend has foreclosed on his home due to extreme hardships, and the VA ended up taking over the property over a year ago. There was a 2nd loan secured by the property, the lender has been calling him to make arrangements to continue paying on the 2nd...he feels he should not have to since the property is long since gone, and he can not afford to do so.
What happens in a situation like this?
Thanks for any input,
Allen
The foreclosure process may have extinguished the second's security interest (mortgage), but the debt, and obligation to repay that debt remains.
He might be able to satisfy that debt for pennies on the dollar, or, they may require payment in full. Sounds like he needs to see a debt negotiator, a bankruptcy attorney, or structure some sort of repayment plan.
[addsig]