How Best To Proceed On Heloc

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KimShea

LoanSafe Member
Jun 7, 2017
1
0
1
50
Hello,

I'm trying to figure out the best way to proceed moving forward.

We purchased our home in 2003. We live in Indiana. Our goals are to remain in our home, avoid foreclosure and bankruptcy at all costs.

Zillow shows our home is currently worth 263,000.
We have our first mortgage through a local bank that has been wonderful, never sold us to anyone, and we're current with them. Balance owed is 198,000. This loan was modified for financial hardship a few years ago, but we've been good with them since.

Several years ago we took out a HELOC from HSBC to consolidate debt. We paid the HELOC for a couple years, and then my husband got laid off his job. Eventually we fell behind. I believe last payment was in October of 2011.

This loan became GreenTree and is now Ditech.

They aren't too aggressive. The loan was charged off at some point, though I'm not sure when. I know at least since April 2015 for sure. Occasionally they send us a bill asking for 40K, which is what they say the amount owed was. Once in a while we get a phone call. We have never talked to anyone there, never acknowledged the debt at all. When they call we don't answer, but they leave a voice mail. We ignore the bills. They've not threatened any specific action.

They have sent us a few settlement offers, but it was always for amounts we didn't have, 20K or 10K. We just don't have this cash available, so we ignored the offers, not realizing we could negotiate for a lower settlement and too afraid to speak with them at all for fear of resetting the clock.

My current harebrained scheme is to wait until October, when the date of last activity on our credit reports is over 6 years old. I think this is the SOL in Indiana, but I'm not certain of that. Then plan is to wait another year for it to drop off the credit reports. Sometime I want to do a title search and see who may hold liens on our property. I don't know what to do if someone does though. And of course lots of praying and finger crossing that we don't get sued or foreclosed on in the meantime. We're only 4 1/2 months away from what I believe is the SOL.

So my questions are, is this a reasonable plan at this point?
Can they still foreclose on our home after the six years?
Is six years the actual SOL on a HELOC in Indiana (there seems to be some debate, best I can tell).
What do we do if after this drops (assuming nothing bad happens in mean time) we find that someone (HSBC? Ditech?) has a lien on our property?
What would be the best course of action if we get another settlement offer? I feel we're so close to the SOL that we should ignore any settlement offers at this point.
If I'm wrong, and the SOL is 10 years, and we opt to settle, can settlement payments be made? or is this something else? We still don't have more than maybe a couple thousand reasonably accessible.

I really appreciate any help or suggestions, or really any information at all. I'm finding the closer we get to the 6 year point, the more anxiety I have about it.
 

Jzone

LoanSafe Member
Jun 20, 2017
219
30
28
70
Hello,

I'm trying to figure out the best way to proceed moving forward.

We purchased our home in 2003. We live in Indiana. Our goals are to remain in our home, avoid foreclosure and bankruptcy at all costs.

Zillow shows our home is currently worth 263,000.
We have our first mortgage through a local bank that has been wonderful, never sold us to anyone, and we're current with them. Balance owed is 198,000. This loan was modified for financial hardship a few years ago, but we've been good with them since.

Several years ago we took out a HELOC from HSBC to consolidate debt. We paid the HELOC for a couple years, and then my husband got laid off his job. Eventually we fell behind. I believe last payment was in October of 2011.

This loan became GreenTree and is now Ditech.

They aren't too aggressive. The loan was charged off at some point, though I'm not sure when. I know at least since April 2015 for sure. Occasionally they send us a bill asking for 40K, which is what they say the amount owed was. Once in a while we get a phone call. We have never talked to anyone there, never acknowledged the debt at all. When they call we don't answer, but they leave a voice mail. We ignore the bills. They've not threatened any specific action.

They have sent us a few settlement offers, but it was always for amounts we didn't have, 20K or 10K. We just don't have this cash available, so we ignored the offers, not realizing we could negotiate for a lower settlement and too afraid to speak with them at all for fear of resetting the clock.

My current harebrained scheme is to wait until October, when the date of last activity on our credit reports is over 6 years old. I think this is the SOL in Indiana, but I'm not certain of that. Then plan is to wait another year for it to drop off the credit reports. Sometime I want to do a title search and see who may hold liens on our property. I don't know what to do if someone does though. And of course lots of praying and finger crossing that we don't get sued or foreclosed on in the meantime. We're only 4 1/2 months away from what I believe is the SOL.

So my questions are, is this a reasonable plan at this point?
Can they still foreclose on our home after the six years?
Is six years the actual SOL on a HELOC in Indiana (there seems to be some debate, best I can tell).
What do we do if after this drops (assuming nothing bad happens in mean time) we find that someone (HSBC? Ditech?) has a lien on our property?
What would be the best course of action if we get another settlement offer? I feel we're so close to the SOL that we should ignore any settlement offers at this point.
If I'm wrong, and the SOL is 10 years, and we opt to settle, can settlement payments be made? or is this something else? We still don't have more than maybe a couple thousand reasonably accessible.

I really appreciate any help or suggestions, or really any information at all. I'm finding the closer we get to the 6 year point, the more anxiety I have about it.
Well, if you havent paid in 6 years, I wouldnt be too concerned. I would find your last settlement offer and send them a letter to contact you only in writing. It just needs to be one sentence: "Please contact me in writing about settling this debt and releasing any lein on the property."

Most likely there is a lien on the property. And it doesnt matter if the finace company has went out of business. Liens are transferable and can go from company to company-whoever buys the debt. But go to you local register of deeds and see what is recorded there to be sure.

If they contact you, start at 5% of the balance. Try to settle at 10-15%. As long as you are current with first, the second is not going to foreclose since they would have to pay off the 1st mortgage holder as well.

Im in similiar situation in Michigan, but did file ch 7 bankruptcy.
 

troubleinriverside

LoanSafe Member
Nov 30, 2008
773
18
18
I have a HSBC Heloc discharged through BK Ch 7 and Charged off in 2010. HSBC turned over the bad accounts to another servicer in New Jersey. I have been trying to obtain a Lein release for almost 2 years. They just cant seem to find my account. Back then there were hundreds of thousands of defaults. The original HSBC Lein still sits on my property. I can see it on the county recorders website. So I'm kind of stuck . You should check with your county recorder. I'm sure that lien is still sitting there.