What do you mean they accidentally failed to pay off the 2nd? Was it on the HUD statement. If escrow did not pay it then you should have received the proceeds from the sale from escrow which would have included the money that would have been used to pay off the HELOC. If Escrow did pay it off but Wamuu failed to record a reconveyance then they have been unjustly enriched as you have essentially paid the loan twice. Once when you closed and again over the last 10 years.