Clients have two loans on their home, but stopped paying on the second, so now the second has gone to collections. What are their options? If we still do a short sale, will the second work with us? Can they negotiate with the 2nd only and do a modification with the first only (or try). How should I handle this case? The second loan is not an equity loan. Call the collections agency and continue the short sale with the collections department and with the second notify the 2nd that you will need short sale approval from their collections department it works done it before...