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Roger, Attorney
Category: Legal
Satisfied Customers: 30909
Experience:  BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
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We sold a business on contract for deed this past spring,3rd

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We sold a business on contract for deed this past spring,3rd down balance of 83,000 over 5 years .Payments have stopped after 6,which is forcing us to stop payment on the 2nd mortgage which we used to purchase the business.Can a 2nd mortgage cause a foreclosure?If so makes no sense to continue 1st payment.In order to file suit for breech of contract will i need a lawyer?As it is well above the small claims limit 7500,what court does it go thru?Would it be best to just start with a letter from a lawyer or my self asking what the intentions are for paying etc before suit is filed?
Submitted: 6 years ago.
Category: Legal
Expert:  Roger replied 6 years ago.

Yes, a second lien holder has the right to foreclose just as the first does. This seldom happens because the 2nd lien holder would have to totally satisfy/pay off the first lien holder before it is allowed to keep anything. Because there is usually not much, if any, equity in property, it is generally not worth while for the 2nd lender to foreclose. However, that's not to say that this never happens - it does.


You would likely need to file the action in district court. An individual person can represent himself/herself in court without an attorney. However, if you're suing on behalf of the business, you will have to get an attorney because a non-attorney cannot represent another person or legal entity.


It is perfectly legal to send a demand letter in good faith before filing suit.

Customer: replied 6 years ago.
Does the fact the 1st and 2nd are both with same bank make a difference?The new owner signed a promisary note with no mention of the business so im assumming i can represent myself?
Expert:  Roger replied 6 years ago.

It does not make a difference in terms of their rights. However, because the same lender holds both notes, it makes it much more likely that the 2nd lien holder will foreclose because any money recovered will be turned over to it.


Yes, so long as the business is not involved, and only you personally, you can represent yourself.

Customer: replied 6 years ago.
Thank you for your help.Joel Wolf
Expert:  Roger replied 6 years ago.
No problem and good luck.
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