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Debt settlement on a secured loan?

Date: Wed, 02/03/2010 - 19:54

Submitted by anonymous
on Wed, 02/03/2010 - 19:54

Posts: 202330 Credits: [Donate]

Total Replies: 2


From my understanding, one cannot settle a debt on a secured loan. But in my case I had a car that was totaled that was financed through Wells Fargo. My car insurance paid off most of the loan. My crappy GAP insurance paid a portion of the remainder leaving me with a balance. Wells Fargo already sent me a 1099-C for this remaining debt that was "cancelled", even though I am still paying on it and have about $1600.00 left. It was a blessing in disguise that I totaled this car for it left me without a huge debt, but I still have this little bit left and I'm going through some financial difficulty right now. I want to settle, would I be able to do this on a secured debt since the collateral they would normally repossess is gone now? Thanks.