1st v. 2nd Mortgage on Short Sale

Working a short sale with a guy who has 2 mortgages. 1st is 110K, 2nd is 26K. I have been investing for a while now but not too much experience on short sales. Is it wise to let both mortgage holders know about the other? Any input would be appreciated.

They generaly know about each other anyway its as simple as 1 O&E (ownership and encumberance)

If you are going to put yourself into a good negotiating position with the second, you need to let them know that the first is only willing to accept a certain amount, say $1000.00. At that point you can negotiate the first down to fair market value, which they usually find out by doing a BPO (Broker Price Analysis) or CMA. You’ve got to make sure that you can find comparable properties that support a lower value or you won’t get that much of a reduction if any.