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For purposes of this paragraph (c)(iii), the consumer authorizes the lender to initiate payment transfers that include such an amount if the consumer's authorization obtained under paragraph (c)(iii) of this section includes a statement, in terms that are clear and readily understandable to the consumer, that the amount of one late fee or one returned item fee may be added to any payment transfer and specifies the highest amount for such fees that may be charged, and the payment channel to be used.
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If you default on your home equity loan, the second lien holder can foreclose on its own, pay off the primary mortgage with the proceeds from selling the home and use what's left to pay itself.
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