As Michael and Walter have stated, your second can move to foreclose and will move to foreclose to protect themselves. You should seek legal counsel regarding your specific situation and try to work something out with the second, or work out a new plan with the first to give you some cash reserves to clear up the amount owed on the second.
The timeframe on foreclosing can take anywhere from 90 days (once you've defaulted) up to a year (on average) depending on how quickly the lienholder decides to work, as well as state law which may mandate more time where applicable. Since I am not an attorney, nor do I know the details of your default, I cannot tell you exactly how much time you might have. It is NEVER a guarantee that they will take longer. Always assume the wrost case in situations like this, which would be 90 days from the default.
Have you tried http://www.KeepYourHomeCalifornia.com?
As it pertains to modifying your second, you may be eligible for an alternative program evaluation with more flexible debt-to-income criteria.
Regarding legal advice, I recommend:
Steve Beede, Founder and Managing Partner
BPE Law Group, Inc.
Main: 11140 Fair Oaks Blvd., Suite 300,
Fair Oaks, CA 95628
Satellite: 9245 Laguna Springs Dr., Suite 200,
Elk Grove, CA 95758 (Appointment Only)
I am assuming you want to keep your home. If modifying either loan is not an option and you are forced to sell, please contact me. At that point, you may be eligible for a short sale and state law may protect you from any recourse from either lender once the short sale closes. In addition, you may also qualify for a seller relocation fee for cooperating with the short sale.
My contact information is below. Hope this helps. Please keep me posted.
Keisha Mathews, REALTORÂ®
CDPEÂ®, HRCÂ®, HAFAÂ® Certified
"The Short Sale Lady"
Century 21 Landmark Network
(916) 370-1803 cell/direct
(916) 405-3886 fax