Private lending in 2nd position

[Jarrod Ochsenbein]

2nd position loan questions

How do you insure you mitigate the risk of not being paid back?

For me I use;

2nd lien on target property or cross collateral property deed of trust

JV agreement

Promissory Note

Personal Guarantee

May be over kill, but I am fine with it.

Also if you ever foreclose on a property that has enough equity to cover your loan I assume the 1st lien gets paid and then the rest would go to the 2nd position or is that not correct?

Thanks in advance.   I am hoping to never go through the foreclose process.

Jarrod