Foreclosure and the Second Mortgage

Asked over 4 years ago - Waterville, MN

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I am curious as to what the status of a second mortgage when the first mortgage was foreclosed on and the home was sold. I was under the impression that if the home was foreclosed on and sold that BOTH mortgages were then taken care of.

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  1.

    Salem Bankruptcy Attorney
    Contributor Level 10

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    Answered November 11, 2008 13:42. The property can be sold at a foreclosure sale free and clear of the second mortgage, but the borrowers remain liable to the second lender on the note, and can be sued for the balance of the loan unless they file for a bankruptcy.

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