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Join Date: Feb 2008 Location: San Diego
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Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0 | Re: Those worrying about "who will rent to us now?"
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Originally Posted by knownick  Update 8/29: | Quote:
Originally Posted by knownick
Bank sent us a letter today reiterating what they told us over the phone - offering us a settlement in full for the second mortgage at 65% of the balance. Also said that if we did not accept this agreement they reserve the right to refer the note to a collections agency or lawyer to recover their full balance "by any means necessary".
Sale date is Tuesday, we're busy packing up our stuff. We will be officially "moving" on the 5th, but plan to keep the place looking like it's lived in, with the hopes of negotiating some sort of cash for keys deal after the sale.
I'm very excited to have this behind us and over with. Looking forward to starting fresh. | Knownick, Please be careful signing documents. if the 2nd mortgage is offering a 65% settlement you should make a counter offer of 10-15% payable in 30 years and no interest with a condition that they will report it to the credit bureaus as paid in less than full balance. You have to used the old tactics of threatening to file for bankruptcy if they do not reduce the settlement down to 1015%, 65% is too much. I found the following information on how to negotiate a deb t. How to Negotiate Debt Settlement What is a Debt Settlement? If you have old credit card or loan debt, then you may want to consider settling your debt with the lenders. Basically, a debt settlement is a business transaction. Let's imagine that you ran up a credit card debt a year ago of $1,000, but haven't been able to pay the balance, or even make payments on the loan. The credit card company most likely eventually gave up trying to collect on the debt, and assigned it to a debt collection agency. But recently, you've come into a little money, and can pay off a portion of the debt. In a debt settlement, you and the lender (or the collection agency that they hired) would negotiate a payment lower than what is owed. But wait! Before you mail in a payment, there are some things that you should know. Believe it or not, you actually hold the ball in this game. The lender only wants one thing from you: the balance, or a portion of, the debt. And in order to get it, they may be willing to take a reduced amount of money, and may even take away the negative comments on your credit report. The Ground Rules The first thing that you should know is that there is a statute of limitations on any debt. What that means is that lenders or collection agencies have only a limited amount of time to collect a debt. If that time passes, then they can no longer make attempts to secure payment and you are no longer under any obligation to pay it. In addition, once this date has passed, the lender will no longer be able to get a judgment against you in court. In effect, at this point the debt becomes uncollectible. The statute of limitations varies in each state, and so it will be necessary for you to contact your individual state to determine the specifics for your accounts. It's imperative that you do this step before attempting to negotiate your debt.>> If you determine that indeed, the statute of limitations has passed, you will need to pass along that information to the lender or collection agency. At this stage, it is essential that you know exactly when the statute of limitations was up, or will be in the future. If it has passed, tell the lender that the debt is now considered uncollectible. If it hasn't passed, tell them that the date is nearing, and that it would be in their best interest to negotiate with you now before the statute of limitations is up Even if you are desperate to pay off your debt, don't let on to the collector that you are. Remember, this is a game of negotiation, and if they sense urgency your part, they are most likely not going to budge. Unsecured debts are the most commonly settled debts. For example, if you have credit card debts, bounced checks, medical bills, personal loans, accounts with collection agencies, or balances left after a bankruptcy or a foreclosure listed on your credit report, you will likely be able to negotiate a settlement for them. Negotiate the Total Amount Owed Your first area of negotiations should be the total amount of the money that you will pay. You should start by insisting that all late fees and penalties be taken off of the balance that you owe. Most companies will do this because after all, their goal is to get as much of the original debt as possible. Sometimes these penalties and late fees can accumulate and increase the amount owed dramatically, so this step alone should relieve a great portion of the balance Next, you'll want to negotiate the original debt, and try to reduce it as much as possible. Remember, the closer to that it is to the statute of limitations, the more likely the lender will be willing to negotiate. It's commonplace to reduce your debt by about 30%, but sometimes it's possible to negotiate down to as much as 5% to 10% of the balance owed. For example if your mortgage balance is $100k you should start to offer 5% and if the lender does not accept that offer, make another offer of 10% which is about $10k payable in 10 years and no interes Negotiate Negative Statements on Your Credit Report Your next area of negotiation should be your credit rating. Depending on how anxious the lender or collection agency is to collect on their debt, it may be possible to erase the negative statements on your credit report, and instead have a comment such as “paid,” or “paid as agreed” on it. Again, remind the creditor that the statute of limitations is approaching, and insist that this be part of the settlement. You might also tell them that if they won't negotiate with you on this part of the settlement, that you will use the money you have to negotiate with another creditor that will place a good mark on your credit report. Occasionally, there will be a lender who simply refuses to budge, but most times they will be open to doing whatever it takes to reach an agreement. It is better to negotiate with the original lender for a good credit report rating, and here's why: On your credit report, there can only be one mark for any debt. In other words, if the loan has gone to a collection agency, you can only have one bad mark for both the original lender and the collection agency. Since the original lender has the control over what this mark says, you should strive to negotiate a good credit rating mark with them. Above all, don't pay the lender or collection agency anything until you have everything that you have agreed upon in writing. Insist that they send you a letter outlining the exact amount that will be paid, and exactly what comment they will put on your credit report... Don't be fooled into doing anything before you have in on paper. Your final step should be to insure that all three credit reporting agencies have updated your credit report. You should get a copy of the receipt after you have paid your settlement balance, and then mail it to all three of the agencies and ask them to mark the item as paid. Summary 1. Find out if the statute of limitations has passed on your debt 2. When negotiating, be cool, as your creditors can sense urgency 3. First, try to get "extras" like fees and late charges removed 4. Next, try to talk the balance down. Getting in down to 30% of the original balance is typical, but it could go as low as 5% to 10%, payable in 30 years and no interest. 5. Try to get the lender to change your negative credit mark to a positive on on your report 6. Finally, report the settlement to all three credit reporting agencies
This is for your information only. Source" Credit Reporting and Negotiating
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