Hey All,
I'll try to keep this short. My uncle is in poor health. At some point, on the advice of someone, he stopped paying his second mortgage($60,000). He was given advice that the second mortgage,. being the second lein on the property, cannot foreclose.
He is now getting threatening letters about foreclosure from the 2nd mortgage people/bank. He is current on his first mortgage.
While I am not the one who gave him the "do not pay the second as they have no claim over the frist mortgage", it has always been my understanding that there is some type of rule of order. The second cannot supercede the first if current.
That being said, my father(his brother) is on the verge of making an emotional decision of paying off his second mortgage. He has been told that once this is done, my uncle will be able to combine the first and second into one payment, but if all this has gone on I can't imagine a bank will be refinancing my uncle. So it's all fishy.
I mainly follow Dave Ramsey's type of advice, e.g. Don't loan friends and family money unless you plan on just giving it to them. However, 60k is a ton of money, and even if they were to settle the debt, I'd expect it to be a lot less.
Hoping someone might have knowledge on this and could give specific advice on debt settling, 2nd mortgages etc.