I am not sure I understand what happened, but I will give it a shot. You stopped making payments on the first and the second. The second started the foreclosure and incurred fees and costs and the second was the winning bidder. The second did not tell the first because they did not want to payoff first. They want to sell the property to mitigate their loss and will be required to pay off first and additional interest when property closes. The second should of paid off the first when the they foreclosed. There is no extra money at this point, however, if the proceeds received when the property closes, you or other lien holder would be entitled to those proceeds(this is something an attorney in your area would have to resolve). The first should of known about the second if they started foreclosure. The second would have a reported lien and the foreclosure would show up on the title too.
Hope this helps
First Weber Group
Certifed Distressed PRoperty Expert