Tsjehome, Home Buyer in Fremont, CA

Please explain explicitly or in layman's terms about what it means- " ...., this loan is in first position, meaning that other loans ....

Asked by Tsjehome, Fremont, CA Sun Jul 8, 2012

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This question is about this property: http://www.trulia.com/foreclosure/3088297369--Valdez-Way-Fre…

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It means that all other loans, or liens, are junior to the loan in first position. The loan in first position must be paid of, or the lender of the first loan must agree to conditions that satisfy that loan, before any other junior loans will be paid.
1 vote Thank Flag Link Sun Jul 8, 2012
Hi, If a loan is in first position it is the first Mortgage. It could mean there is another loan as well or it could be the only loan. The realty Trac that is advertising this home is a company that is trying to get you to pay them for information on Homes in default, foreclosing homes or foreclosed homes. You can get that information for free from a Realtor. The home you are asking about may or may not be in foreclosure it may just be in default (they have missed one or two payments?) and the owners may catch up and go out of default....Good luck hope this was helpful..If I can help further feel free to contact me.....Dawn 510-909-0373
0 votes Thank Flag Link Mon Jul 9, 2012
It is common for a buyer to get more than one loan to buy property --- the first loan for the bulk of the purchase price, and the second loan to cover the down payment.

Or...even if the borrower only got one loan, he may have borrowed against his home equity to finance certain expenses like remodeling.

In this case, the link you provided said that "The estimated original principal balance of the loan in default". Since this is the remaining balance, sounds like the owner has significant equity in the property and may be doing his best to resolve his delinquency. And even if he is foreclosed, please don't expect that the $$ you see is what the price would be to buy this house because the foreclosing bank will want to list this for sale as close as possible to market value.

It is not known from this link if there are other liens against the property in the form of a second loan, or even mechanics lien filed by unpaid vendors who want to collect what is owed.

If the property is sold in a short sale, typically, the primary lender is paid first (in addition to paying off unpaid taxes). Then the primary lender can offer to pay off the junior lenders a fraction of what is still owed to them.

In a foreclosure, the primary lender doesn't pay off any junior liens ...just the unpaid taxes.
0 votes Thank Flag Link Mon Jul 9, 2012
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