Re: 1st foreclosed what happens to 2nd

Posted by Steele in Minnesota on April 18, 2005 at 23:25:57:

In Reply to: 1st foreclosed what happens to 2nd posted by chad on April 18, 2005 at 21:57:54:

: If a home in Michigan is foreclosed and sold at sariff's sale for loan amount of the first note. What happens to the junion lien? Does it go away or does it remain on title even with the new owner?

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Typically in any state if there is only enough money bid at the Sheriff Sale to cover the first mortgage, any other liens (except IRS liens)will go away. So a 2nd will be gone.

Because of this the 2nd mortgage holder will have to decide whether to bid on the property and possibly recover some or all of it's money or just take a loss.

I know after a sheriff sale here in Minnesota that although there was a six month redemption period I was informed that the 2nd mortgage would have one additional week to redeem after that. So you might want to check the timetables and rights of other lien holders behind the 1st mortgage just to make sure.

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Comments:
: : If a home in Michigan is foreclosed and sold at sariff's sale for loan amount of the first note. What happens to the junion lien? Does it go away or does it remain on title even with the new owner?

: ------------
: Typically in any state if there is only enough money bid at the Sheriff Sale to cover the first mortgage, any other liens (except IRS liens)will go away.  So a 2nd will be gone.

: Because of this the 2nd mortgage holder will have to decide whether to bid on the property and possibly recover some or all of it's money or just take a loss.

: I know after a sheriff sale here in Minnesota that although there was a six month redemption period I was informed that the 2nd mortgage would have one additional week to redeem after that.   So you might want to check the timetables and rights of other lien holders behind the 1st mortgage just to make sure.


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