Question about 2nds and foreclosure

[Eric S.]

Fellow Note Investors,

When a first lien holder files foreclosure, are they required to notify the other lien holders of the Lis Pendens?  Or can they proceed to sale without the other lien holders being notified?  Is this a state by state procedure?  

I ask because I hold several performing seconds, and I'm looking for a sensible way of protecting my positions short of calling on the firsts/pulling credit every 4-6 months.  

Thank you and happy note investing!

[Chris Seveney]

Eric S. To answer your question it is a state by state issue but I am pretty sure most if not all states require all lien holders on a property be notified by the foreclosing party

Now what happens in many instances is purchasers of notes do not record the assignment so the prior owner is notified and they toss it in the trash because they don't care / own a lien on the property

Talk to your servicer or attorney they can answer that for you (which I hope you have both).