Legal Question in Real Estate Law in Minnesota

Typically (as in almost always) the first forecloses, the second does absolutely nothing until after the foreclosure is complete, and then sues you for the unpaid debt.

If you are going to try to resolve this without keeping the house, you should be pro-active, perhaps trying to sell the property, perhaps negotiating directly with the holder of the 2nd. (Good luck in getting the bank to notice you!)

You could try to modify the mortgage or mortgages to get them to a point where you could afford to hang onto them. This is usually a very frustrating process -- the mortgage companies seem to have purchased bad fax machines, as they routinely lose the package of documents you sent them. But I have seen a few mortgages modified, so you should consider attempting that.