Stop paying on 2nd heloc that is in the money?

[dpr88]

Had our chapter 7 dishcharged in 2010 in Arizona and had both the 1st and 2nd discharged...
1st (B of A) $264
2nd heloc (Compass Bank) $170
Zillow value $395

Everything is current and we would like to stay here but it is getting out of reach... Since the 2nd is in the money (loan of $170k and they would lose approx $44K and perhaps recoup $126K upon the sale of the home), should we stop paying on this 2nd to save money and would they try to foreclose?

Can they foreclose if there is a first lein/loan on it?

[SMinGA2]

They can foreclose, though they would have to buy out the 1st. Its a dangerous chance to take if there really is a decent amount of equity for the 2nd, unless you intend to let the house go at some point regardless.

Zillow is not the best resource for house values. What have similar houses near you sold for recently?

[dpr88]

The equity they would be trying to recoup is about $130k of a $170k heloc... I think the zillow estimate is fairly close looking at all the other sales in the neighborhood.. Typically, is there a rough % cut that a foreclosed house would go for vs. a regular house sale?