Legal Question in Real Estate Law in Washington

Re: Holding 2nd DOT - First is in forebearance

To answer your first question, if you foreclose, the first will have to be paid off prior to any funds being distributed to you, to cover your second. That's the whole point- to give creditors a priority order when it comes time to pay folks off.

If the first creditor moves him into foreclosure, that does not weaken your position, it simply means that you will be paid off with what is left after the first is paid off. If there is a shortage, you will be left holding that bag no matter who forecloses first. One difference may be that if you wait longer, the first's fees and balance may increase, thus decreasing what is left for you.

If equity is tight, or you are sure that there is not enough to cover your portion, you have to evaluate whether to foreclose now and get what you can, or wait and see if the situation improves over time.

There is a lot of "it depends" loaded into my answer, so that I really would have to know a lot more detail than what you may be able to provide here. To that end, if you would like to set up a consultation, please feel free to get in touch with me.

In the meantime, I hope this helps at least give you an idea of where you sit.