Pre-Foreclosure - Negotiating Down the 2nd Mortgage

[Mike Cesa]

Hi everyone.  I am a newbie, and I have been looking at pre-foreclosures.  I found one I am interested in with these numbers:

ARV: $550,000

Loans: $350,000 1st

$150,000 2nd

If this property goes to auction, does not sell, and becomes an REO, the lender on the 2nd will get nothing, correct? So as an investor, am I able to negotiate down the 2nd with that lender, before I purchase the property directly from the owner?

[Wayne Brooks]

@Jay Raught Not sure what you're saying.....but if you are the second, and the first forecloses properly, your lien gets wiped and you can Not put a lien back on that property.  If you're saying you could get a deficiency judgment against the individual, well then sure.