Subsequent Lender Positions
2nd mortgage lender generally does not start a foreclosure and, therefore, has not elected their remedy just because
the first mortgage lender has commenced a foreclosure. If the property does not generate enough to pay the second lender,
their not going to start a foreclosure and will not redeem from the foreclosure of the first mortgage. Unlike the first
lender they have not elected their remedy to forgive the deficiency since they have not foreclosed by advertisement.
The lenders who are after the first lender do not have the same incentive to approve the short sale or to forgive the remaining
debt since they receive little or nothing from the sale proceeds. The negotiation with the subsequent lenders involves
convincing them that the borrower does not have the financial position to ever pay the first amount and that they are better
off making a deal with them.