When 2nd is wiped out at foreclosure sale

[George P.]

When 2nd lien position mortgages are wiped out at the first mortgage foreclosure, do the banks (note holders) have a right to file a deficiency judgment agaisnt borrower in order to try and recover their loss (at least partially) ?

If yes, do they normally do it or rather charge off the amount?

Thanks for the input!!

:cool:

[Bill Gulley]

Hi, this varies state to state. Some states allow redempyion by junior liens, and at different amounts. Homeowners in some places will have deficiences from all liens. The second is not extingusihed, it's the secured position that is lost. Check with your state;s statutes for perfecting, priority and release of liens.