2nd Mortgage Balloon Payment Past Due

[mpsATL]

Mates, I need some advise re: my 2nd loan that had a balloon payment past due.

State:
Property Value: $155,000
1^st Lender: CitiMortgage
1^st Loan Balance:$153,000
Purchase money? Yes__X__ No____
2^nd Lender: PNC Bank
2^nd Loan Balance: $58,000
Purchase Money? Yes____ No__X__

My balloon is past due. I am thinking of writing them a letter since I haven't been able to talk to someone. I have already read the thread on settling the 2nd. However, I do not want my credit history to get messed up, so the need to mail them.

I am asking them for the following conditions to the settlement. Am I missing anything?
- I will pay the bank $5,000 as full settlement towards the loan
- PNC bank will remove an lien towards the title for my property at ...
- PNC bank will mark the loan as ‘Paid In Full’ to the credit reporting agencies
- No personal liability after settlement
Thanks !

[Evan Bedard]

My balloon is past due. I am thinking of writing them a letter since I haven't been able to talk to someone. I have already read the thread on settling the 2nd. However, I do not want my credit history to get messed up, so the need to mail them.

I am asking them for the following conditions to the settlement. Am I missing anything?
- I will pay the bank $5,000 as full settlement towards the loan
- PNC bank will remove an lien towards the title for my property at ...
- PNC bank will mark the loan as ‘Paid In Full’ to the credit reporting agencies
- No personal liability after settlement
Thanks !

Welcome and thanks for joining the community.

When was the balloon payment due on your 2nd? Unfortunately, the chances of your 2nd mortgage settling the loan when it is current is not very likely and I personally have not seen a 2nd mortgage holder report a settled account as "paid in full." I'm not too sure this is a possibility without taking a hit to your credit score..

[mpsATL]

Evan, Thanks for posting a response.

My second was already due a couple weeks back (April 24th 2012).

Thanks for the info about 'Paid in full'. Not the answer I was looking for, but guess might have to live with a bad credit report. I will try geting in touch with them.

What are your thoughts on initiating a letter from my side? Any downsides?

[Evan Bedard]

Thanks for the info about 'Paid in full'. Not the answer I was looking for, but guess might have to live with a bad credit report. I will try geting in touch with them.

What are your thoughts on initiating a letter from my side? Any downsides?

I definitely agree with you that a settlement seems to be a good option in your situation. You can write a letter explaining you want to work out a settlement on the loan because you do not have the funds to pay the balloon in full and the mortgage is completely underwater so they are in no position to pursue foreclosure.. Here check out this thread you will find many members here who successfully settled their 2nd mortgage:

Success Stories in Settling 2nds

[mpsATL]

Evan,

I got an email from the Bank today. They are looking for my financial details. Should I provide the documents? I am afraid they might find something NOT to settle.

From reading the other threads, I believe I am not obliged to provide them any financial documentation. Do they really need these documents? What are your thoughts?

Would I get them mad if I refuse to provide any documentation.

Thanks!

[mpsATL]

One more thing. One of the documents say

1. If the account is a home equity line of credit account, I/we direct PNC Bank to release the property lien at timethe balance is paid in full.
   
   Does this mean they can hold the lien until the loan is paid in full?

[TomEason]

mpsATL

Thanks for your post.

I recommend you never consider disclosing financials to your lender. They don't need that stuff in order to make a settlement.

Please know that your behavior comes across is somewhat obsequious. Your lender's negotiator can sense this, and will seek to exploit that perceived weakness. If you want a favorable settlement you might brush up on your negotiation skills. The lender is your adversary, not your friend.

And since this is a negotiation, who cares if you make the lender's negotiator mad?

I recommend you carefully re-read the settlement guide at post #1 of that thread and follow it. Good luck.

Strategy for Settling Your 2nd