Im looking at a los angeles county foreclosure list and i understand if you buy at the trustee sale all loans below the foreclosed loan get whiped away but what happens to the other loans if you arrange to buy the home from the owner before the sale?
IMO: they're still in place and the 2nd td holder can exercise the due on sale.
I agree with NA Beard the 2nd will stay in its place and the 2nd will be in a position to foreclose because of due on sale if the clause is in the loan docs but they are also entitled to foreclose for any other default... if the 1st was foreclosing chances are that the 2nd was in default too
You could negotiate (short sale) the 2nd or 1st and 2nd depending on loan balance and market value.
Thank you All! Happy new year!