Just food for thought.In addition to HML, there is private investors such as IRA holders (self-directed), people with $ in CDs earning tiny returns (compared to RE), family, friends, associates, etc.

The trustee sale wipes out subordinate liens(loans) and the proceeds go the the primary lien holder.

The borrower may obtain one such postponement.ReinstatementDebtors may reinstate up to five days before non-judicial foreclosure sale.JuniorJunior lien holders may no longer redeem, so they may try to protect themselves by (1) advancing funds to bring the senior loan payments current, then foreclosing for the sums advanced; (2) bidding at the foreclosure sale so the price will be sufficient to payoff the senior and the junior liens; or (3) acquire the property by bidding at the foreclosure.

I'm asking if anyone here makes loans that are Deeds of Trust, in other words they are written up that way...as Deeds of Trust....recorded at the county as such.In my mind when you are loaning private money in small amounts....the only way you can be protected from being in the second position (and ultimately thrown out if foreclosure occurs) to the 1st mortgage holder is to write it up as a Deed of Trust.

Would you suggest advising the lender of the possible transaction before it takes place as to abide by the terms of the agreement between the loan holder and the lender?

If you are a long term holder for cashflow purposes, then you'd be better off doing what MikeOh does, and that's buying properties that will cash flow with no money down and that have a chunk of equity in them already.

That's true.But top earning real estate investors don't (usually never) wait for appreciation.Big RE profits are based on improvements, buying at discount, best use, selling at premiums and other profit possibilities.The graph of Growth of Stock vs. real estate doesn't apply toRE investors that don't prefer the "wait and hope" 'technique'.The graph of Growth of Stock vs. real estate does apply tolong term holders.

`(b) Purpose- The purpose of the HOPE for Homeowners Program is--`(1) to create an FHA program, participation in which is voluntary on the part of homeowners and existing loan holders to insure refinanced loans for distressed borrowers to support long-term, sustainable homeownership;`(2) to allow homeowners to avoid foreclosure by reducing the principle balance outstanding, and interest rate charged, on their mortgages;`(3) to help stabilize and provide confidence in mortgage markets by bringing transparency to the value of assets based on mortgage assets;`(4) to target mortgage assistance under this section to homeowners for their principal residence;`(5) to enhance the administrative capacity of the FHA to carry out its expanded role under the HOPE for Homeowners Program;`(6) to ensure the HOPE for Homeowners Program remains in effect only for as long as is necessary to provide stability to the housing market; and`(7) to provide servicers of delinquent mortgages with additional methods and approaches to avoid foreclosure.

Was hearing many 2nd position lien holders will sell their position off last minute thinking if the 1st forecloses they lose it all.

I'm selling a home that I own clear on contract in which I will be the lien holder/providing no bank financing to the buyer.