How can I foreclose on a property that was sold with a wrap around mortgage?

UPDATED: Aug 23, 2011

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How can I foreclose on a property that was sold with a wrap around mortgage?

I am an original mortgage holder on a property. A 2nd party “took over payments” and “rented the property” until he could sell it. He actually sold it with a wrap around mortgage without my knowledge and is now almost 3 months behind and the bank is going to foreclose. Do I foreclose on the 2nd or 3rd party or does the bank? What is supposed to happen?

Asked on August 23, 2011 Texas


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

If you are in first position as a secured creditor on certain Texas real property, you can serve a notice of default upon the property's owner as well as all other junior lien holders of record and see if anyone cures the default where you are in first secured position. If you decide to foreclose, you would wipe out all junior lien holders and end up taking title to the property in the event of a successful foreclosure.

If one of the secured juniors is planning on foreclosing upon its secured interests in the property, there is the possiblity that this secured junior may cure your defaulted first position to save its secured position.

In California, the most economic way to start a foreclosure is to retain a title company to do it. There are many technicalities in a foreclosure that need to be adhered to and it is best to have an entity familiar with the process do it rather than you trying to learn along the way.

Good luck.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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