Hello BP community, 

Really need some help and ideas on dealing with this situation. I know I probably shouldn't have done this deal, but I have lent on 2nd liens successfully before.  This one however, gone pretty bad.

Back in Sep, I was introduced to a rehabber/RE agent from Orlando FL. He was looking for a 42K loan and had 45K of his own cash in the deal. He had a 1st lien at 437K and was projecting 630-700K ARV. We agreed on personal and corp guarantees and a recorded 2nd lien. Everything was going good until about Dec when his contractor was out of town and he had to wait for him 4 weeks. After that things get murky... updates were hard to get and were far and few between... the last communication was that the original contractor was overpaid and didn't finish and he was talking to another one to complete the project...after threatening legal action he goes completely silent around beginning of March.

Now I start looking into it and find out that:

1. There is a third lien recorded for 42K

2. The first lien states that they do not allow any additional liens on their deals.

3. There is a person involved who is a title company owner and recorded mine and the third lien, who apparently brought the third lien to the deal and told them they were in second position. He is now claiming to have put his own money into the deal to bring the first lien current that was delinquent since Dec and that he speaks to the rehabber regularly and has some people involved who are going to finish the construction.

Sent the borrower a demand email, based on a clause in our contract that property must be listed for sale within 90 days or he is default... No response.

Had multiple people, including the person who introduced us and the title owner tell him to reach out to me... No response.

I also spoke to the third lien holder who believes his investment is safe. I think he might be comforted by his relationship with the title owner who keeps reassuring him he is not going to lose money... I am much less sure of that at this point.

Working on getting an attorney to send a demand letter, but I feel it will get the same response as my attempts to communicate. Looking for angles to pressure him to get back to the table, be open about the situation as crappy as it is and work together or step aside and let me take over the project, so it can be finished and sold as soon as possible. 

What are my options.. what would you do in my position?