This is a great question for a real estate attorney. I would be happy to recommend one if you need a referral.
Meanwhile, you should notify the 1st Trust Deed holder that you hold the second and request notification of any action they are taking against the property. Since the 2nd TD is a junior lien to the first, it would be wiped out in a foreclosure action by the 1st.
Having been an investor and working with investors, I actually know people who buy 2nd TD's on home in foreclosure (at a deep discount), bring the 1st TD current and then foreclose on the property themselves. This play only works in a situation where there is sufficient equity, but has been quite lucrative for some of these investors, especially if they can create equity by their purchase of 2nd for pennies on the dollar.
If you find out, from a real estate attorney who has reviewed all the facts of your situation, that you are a lien holder, then you will want to protect your position by knowing what is happening with the 1st TD.
Best of luck to you and Dare to Dream.
Real Estate Consultant
RE/MAX Palos Verdes Realty