Title Chain Puzzle, When Can a Junior Take Out a Senior?

[Marc M.]

Here is a scenario I'm looking at in Los Angeles County, and hoping to find a win-win scenario to step in as an investor to help out this guy out: 

High equity owner ($800k+), senior citizen, living off of social security with 4 mortgages as follows:

1st) $12K

2nd) $250K

3rd) $30K

4th) $20K

The 1st and the 2nd are on the brink of foreclosure (60+ days), and the 3rd and the 4th are personal 'loans' secured by a deed of trust in the county records. If the 1st initiates a foreclosure, how can the 2nd, 3rd, or even 4th in line protect themselves? It would seem obvious that the 2nd would eagerly pay off the foreclosing first, but I'm unclear on the mechanism to do this (aside from just sending the mortgage company a check), and wondering how they eventually get reimbursed? Or is that just the cost of saving your $250K from going down the drain?

Alternatively, let's say the first begins foreclosure proceedings, can the 3rd or 4th step up and pay off both the first and the second mortgages to take a senior position? 

What would the best strategy be to make a small loan to the homeowner? I'd be fine to take a 5th position because there is a lot of equity in the property, but I'm unsure about the rights of junior loans to foreclosing seniors. 

Thanks,

Marc