Legal Question in Real Estate Law in California

You can lose your house if you don't pay any mortgage. That's the entire point of a mortgage: if you don't pay, the lender takes the house and sells it to pay off the debt.

Yes, indeed; the essence of a mortgage (or note secured by a deed of trust) is that the house is collateral, and in the event of a failure to pay any mortgage or deed of trust, the lender is likely to foreclose, i.e., sell the collateral (your house).

Yes, but it can be rare depending on the market. The reason is that when the lender holding the promissory note secured by a second deed of trust forecloses, the purchaser at the foreclosure sale takes the property subject to the first deed of trust. If the foreclosing lender is the purchaser, then the foreclosing lender must pay off the first, or lose the property when the first forecloses. (Obviously, in this situation, the original homeowner has no interest in paying the first anymore.)

If a third party purchases at the sale, the third party is also subject to the first deed of trust. Most people who bid on foreclosure sales don't want to take the property when a first deed of trust exists, because they would have to pay that off also to avoid foreclosure on the first.

So whether it is going to happen depends on the market value of your property, the amount of the debt, and who the lender is.