I'm in a situation where it is looking more and more likely that an impending foreclosure is likely. A couple years ago after a neighbor's house sold for $625k I took out a 3rd mortgage to finance a business that is now kaput. My first mortgage is $250k @ 4.375%, 2nd $230k @ 6.25% interest only, 3rd $100k @ 8.25% interest only. I'm on all three while my wife is only on the 1st mortgage. The houses in my area are only selling for $450+/- now so not much hope of selling because I'm 130k upside down. From what I've heard if I don't pay the third they will just sit tight and wait to see if they can ever get anything from me or just sink me but they won't get much. If I don't pay the 2nd they might be very likely to take the house because they might at least get some $. When this happens will my wife's credit be kaput? What if my wife keeps paying the 1st until the bank with the 2nd sells the property and ultimately pays off the 1st (Will it still go as a foreclosure on her credit?) I'd like to somehow protect her.

I would imagine if the payoff of the first mortgage doesn't come directly from your wife and you of course it will be noted as such on her credit report.
The mortgage companies are most qualified to answer this. Ask, they will tell you.

No matter which of the 3 that foreclose on the property, you will both have it showing on your credit as a foreclosure. Talk to a bankruptcy attorney and evaluate your options under a Chapter 13. Odds are you will qualify for a straight Chapter 7 bankruptcy and you can just start fresh.

Paul
See my profile for contact information

I haven't been here in awhile, and pardon me for not stopping by.

Haven't I read somewhere that foreclosures are up last year between 34 and 70% in some areas?

Thanks, guys.

I ended up speaking with an attorney yesterday. I'm trying to tough it out a little bit more and see if anything good happens. I don't want to start fresh as I'd rather work my way out of things, but I'm doing what I can to protect my wife. Thanks to the forum for trying to help or push me in the right direction.