Real Estate News From Around The World February 9, 2012

What Happens To A Second Trust In A Foreclosure? Question: What happens to second trusts and mortgages in a foreclosure? Answer: When a property is foreclosed, it is sold to the highest bidder. Usually the lender with a first mortgage or first trust bids enough on the property so that any buyer must at least pay off the first loan. As to the holder of the second trust or the second mortgage, that individual cannot collect a dime until ALL money due the first note holder has been repaid. Because second trusts and mortgages represent more risk than first loans, they command a higher rate of interest. Written by Peter G. Miller. © 1997 Peter G. Miller. All Rights Reserved. Rules, Disclaimers & Notices. Click here for a printer-friendly version of this article. Click here to translate this page to another language. Copyright © 2012 Realty Times. All Rights Reserved. Send Us Your Comments