Settling 2nd Mortgage - Negotiate Credit Report?

[avoid]

Hi,

Great forums, appreciate all of the feedback. I am about to embark upon this process of settling my second mortgage. That said, I have wondered about the ability to negotiate the credit report feedback from GMAC.

It appears the standard reporting after settlements is "Paid in full - for less than the full amount". This is derogatory terminology, along with the barrage of missed payments affecting the credit history.

Is it possible, during the negotiation, to request the following :

1. Settlement of $X to cover current $Y HELOC. (The settlement)
2. Documented proof that they will remove the second lien from the primary mortgage.
3. Report the debt as PAID in full to credit, without reflecting that it wasn't the full amount OR upon payment of the settlement amount, GMAC will have all credit feedback withdrawn completely. (All historical missed payments and final debt settlement). Almost as if I never had a second HELOC.

I know this seems a little crazy, but post #1 makes it seem as if it's something possible. If I am going to significantly impact credit, I will likely pursue foreclosure. If I can take this route and have temporary credit impact, but have it removed immediately after settlement - I would be estatic. I haven't seen any questions or people that have proposed this question.

If someone with experience or knowledge in this area can respond, it would be appreciated.

Thanks.

[Evan Bedard]

1. Settlement of $X to cover current $Y HELOC. (The settlement)
2. Documented proof that they will remove the second lien from the primary mortgage.
3. Report the debt as PAID in full to credit, without reflecting that it wasn't the full amount OR upon payment of the settlement amount, GMAC will have all credit feedback withdrawn completely. (All historical missed payments and final debt settlement). Almost as if I never had a second HELOC.

Welcome and thanks for joining the community.

For the most part your 2nd mortgage will need to be in default or even charged off before the servicer will consider settling the mortgage.. However, one member has reported recently that they were abler to settle their second without missing a single payment and if this is accomplished your credit should not be impacted much at all. I'm going to try and find that thread and post a link for you to view.. As far as your credit report goes I do not think you are going to be able to remove the debt completely from your report, of course you can always try to negotiate the way it is reported, but I'm not sure if they will agree to report the account as "paid in full."

[roadtofreedom]

Hi Evan - did you ever come across that thread? It has piqued my interest.

[Cat Damiano]

HI roadtofreedom,


Here is the members thread who settled their second lien with out being in default;

Back and attempting settlement with CitiMortgage on 2nd

[Preparingfordefault]

I'm 13 months behind and I'm hoping someone who has been successful will answer this question... trying to learn what to ask for and what is possible to negotiate to minimize the hit.

[roadtofreedom]

HI roadtofreedom,


Here is the members thread who settled their second lien with out being in default;

Back and attempting settlement with CitiMortgage on 2nd

Awesome, thanks! I may attempt the same thing initially when I plan to stop paying, maybe disguised as a "Just letting you know I can no longer make these payments, the debt was already discharged in BK, you have my permission to contact me with settlement offers", or something along those lines.