Full question:
If my house is being foreclosed, what are my responsibilities for a home equity loan with another financial institution?
- Category: Real Property
- Subcategory: Foreclosure
- Date:
- State: North Carolina
Answer:
When a house is in foreclosure, the priority of liens is typically based on the order they were recorded. Generally, the lender of the first mortgage has priority over later liens, known as junior creditors. If the property is sold in foreclosure and there are no proceeds left after paying the first mortgage, junior creditors may not receive any payment. In such cases, they could pursue other assets of the borrower to recover their debts.
If you have a home equity loan (a second mortgage) and are facing foreclosure, your responsibilities depend on the nature of the foreclosure and the timing of the liens. For instance, if the foreclosure is due to unpaid property taxes, those liens might take precedence, even if they were recorded after your mortgage. To understand your specific situation, you can contact the land recorder's office in your county to check the filing dates of the liens.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.