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I have 2 mortgages that if the lenders would settle for 50%? 75%? would consider paying off. The loans are not in arrears and never have been. Both amount to around $100,000 each so have an encentive to pay off. Is this possible?




Quote:
Originally Posted by Anonymous
Hi,

I am planning to settle my second HELOC($106) with WF, which was taken when we purchased the home in 2006 in California. I think it is a purchase non-recourse loan(I dont know how to confirm this). I am current on my payment so far till last month and my next one is coming this 1st.

My first is with Citi - $570

The higher end of appraisal would be around $610-$620, so there is essentially $40-50k worth of equity.

Would WF work with me on a settlement.

Thanks..


No one can say with certainty, but that's not the ideal situation, if you are looking for a settlement on your HELOC. Generally, you'd want that balance to be underwater as well, for the most optimal settlement.

I think you can probably drag it out long enough to force some sort of settlement with them, but just beware of the potential consequences. They could elect to just foreclose on your house. So if you go down that path, be prepared as that is a possibility.

In my experience, it wasn't as easy as just not paying for a while and then settling at the end. It's a gamble and the banks don't necessarily react rationally, it hurts your credit, and there's a lot of difficult phone calls and letters the whole time.

Sub: #81 posted on Mon, 04/12/2010 - 15:44

ball_mich ball_mich

(Posts: 360 | Credits: )

Hello,

Here's my situation:
I have 1st and 2nd with Wells Fargo. My first was just re-modified under HAMP with a balance of $334k. The 2nd has a balance of $82k and the house is currently worth about $292k.

Wells Fargo Home Equity Solutions assigned a loan adjuster to my 2nd and put me on a reduced payment plan of $232mo. I have been making the payment since Sept. of 2009, but just got a letter last month stating that i have been approved for a mod thru W.F. but I have to make 3 payments of $394mo. to get approved. I immediately called the loan adjuster and told her the new payment is too much for me to afford but she told me they would eliminate me from the mod program and everything that is late and past due would need to be paid if i didn't make these payments. Fearing this I borrowed sum money from a family member to make the first payment but cannot do this every month.

Since the house is upsidedown I want to try to settle with them but don't know how to approach it. I can't see why they wouldn't want to settle since they are the junior lien and they would get nothing in case of a short sale or foreclosure. After reading your thread though I see that its a bit more complicated than it seems. Any advise would be helpful.

Sub: #82 posted on Mon, 04/19/2010 - 18:03

Unregistered


Hi ball_mich, this is an awesome thread with lots of useful info. Maybe you can give me your two cents (i need them).
I have 1st:150+k, 2nd: 60k (heloc), both with WF, in a recourse state (sunshine state). I'm about 90 days late on HELOC. Primary lender is about to abandon short sale process (waiting for lien release from HELOC). In my case I want to leave the home and move out regardless. My lawyer says if I settle for anything above $10K is not worth it. WF refused my offer to settle for $5K. They want 20% cash now (to release lien) + unsecured loan for entire balance. I said no way, I want to settle. They said 50%. I left it at that for now. The whole time I was telling them my financial odyssey of the last 5 years they were sort of chuckling (althought they did listen). Their attitude is that they don't care and they're convinced that you're trying to milk the system.
So, should I let it go into foreclosure, keep it going (I might have to restart short sale with primary), or continue trying to settle? If I can get 17% I think that would be optimum but from the sounds of it they are very adamant in their 50%. Thanks

Sub: #83 posted on Mon, 04/19/2010 - 20:28

Unregistered


[COLOR=black]Hi ball_mich, [/COLOR]
[COLOR=black] [/COLOR]
[COLOR=black]I have been reading your posts and am very impressed in the way you handled your situation with WF. I am a resident of CA and have a home that would appraise for $425,000 at most. I owe on my first with Citi $408,000 after they modified my loan. I have a HELOC with WF for about $97,000 and they are trying to do a modification for me. I have initially given them my documents like paychecks, tax returns, they even asked me how much I have in my 401K and I just said $20,000 but did not give them any documents of my 401K. They did reject my modification package at first saying that my income was too low and now they are saying that their bank has signed up for the government plan and most probably they can modify my loan. They put me on a low monthly plan and got authorization for paying them for the next three months from my checking account. [/COLOR]
[COLOR=black] [/COLOR]
[COLOR=black]I simply did not know that it would be possible for me to settle with them. But I am thinking even if they foreclose my house they have to pay the first loan to Citi first and then they get any leftover money. [/COLOR]
[COLOR=black] [/COLOR]
[COLOR=black]Now I am trying to settle with them. My situation is different than yours because they already have my financial documents, which is not showing much money. [/COLOR]
[COLOR=black] [/COLOR]
[COLOR=black]So I am thinking to contact the settlement department before they send me offer for the modification and also call the person who is working on my modification and say that it is not possible for me to pay these monthly payments (which is the truth).[/COLOR]
[COLOR=black] [/COLOR]
[COLOR=black]What do you think is the best way to deal with them? Do you think I would have any luck with them? [/COLOR]
[COLOR=black] [/COLOR]
[COLOR=black]I can pay an attorney to do this for me but I kind of don't trust the attorneys. At the same time they do all the talking with the bank and know what to say. Obviously, I have done everything that I should not have done like giving them my information. Look forward to hearing from you.[/COLOR]

Sub: #84 posted on Mon, 04/19/2010 - 21:55

Rose_ Rose_

(Posts: 2 | Credits: )

I too work in the industry. I work for a company that helps homeowners with a variety of negotiations. The thing is that we do the forensics before we ever talk to the banks. It changes things dramatically. You see, it really is a fact that most of the loans over the past decade are loaded with federal violations that the lenders do have to handle.

If you show the lender what he is guilty of, you can open a lot of doors. What I find really funny is that the lenders will actually try to tell people forensics will do them no good, but recently I was reviewing a loan mod from one of the big banks, and lo and behold, they've got language in the final section that discusses how the homeowner agrees that the original loan docs are valid and basically the borrower has to agree that he won't take any future action against the lender - and remember he can't get his mod unless he signs it! Point being - Forensics really do work if lenders are feeling the need to insert language to protect themselves from the forensics in their modification offers! As a note, that person found our company and requested we review before they signed what the bank has offered.

So whenever you are trying to get the upper hand, make the forensics your first step. I hate it when I see homeowners miss payments and risk their homes going into foreclosure to try and gain leverage over the banks. There is no leverage in that. The bank just takes the home. They don't care, go read some of the various news reports, they make money off those foreclosures big time, so it only hurts the homeowner.

He, the homeowner, needs a solution that does not have him at fault. Getting TRUE forensics done on the original loan is his ammunition. Also - if you are considering doing forensics - stay away from the pass/fail software programs out there - those are scams. Get a REAL forensic examiner, or company. And another word of caution, and I know this from experience. There are a lot of attorneys who claim to know forensics. They don't. How do I know? Our company has a lot of attorneys as clients, and we have done numerous forensic audits for people who already paid an attorney - who found nothing - yet when our examiners did them, we would find on the average up to 39 violations in the loan. So be careful who you choose.

But once they are all done, you will have so many more options than you had before, and banks do listen - just remember - getting them to the banks and getting the banks to pay attention is also a fine art. Don't give up the good fight for your home folks. Just know how to fight and win.

Sub: #85 posted on Thu, 04/22/2010 - 19:00

Unregistered


Quote:
Originally Posted by Anonymous
Hi ball_mich, this is an awesome thread with lots of useful info. Maybe you can give me your two cents (i need them).
I have 1st:150+k, 2nd: 60k (heloc), both with WF, in a recourse state (sunshine state). I'm about 90 days late on HELOC. Primary lender is about to abandon short sale process (waiting for lien release from HELOC). In my case I want to leave the home and move out regardless. My lawyer says if I settle for anything above $10K is not worth it. WF refused my offer to settle for $5K. They want 20% cash now (to release lien) + unsecured loan for entire balance. I said no way, I want to settle. They said 50%. I left it at that for now. The whole time I was telling them my financial odyssey of the last 5 years they were sort of chuckling (althought they did listen). Their attitude is that they don't care and they're convinced that you're trying to milk the system.
So, should I let it go into foreclosure, keep it going (I might have to restart short sale with primary), or continue trying to settle? If I can get 17% I think that would be optimum but from the sounds of it they are very adamant in their 50%. Thanks


What state are you in? Florida? I have to say, that I'm really only familiar with California's laws and they do differ by state.

In my experience, at only 90 days past due, you aren't talking to anyone with authority that can really settle the balance for the rate you are looking for (17% based upon your figures). I didn't get to that point until after I charged off at 180 days, and even then it took some time dealing with the Recoveries group to work out my settlement. When you are talking to the people in the Loss Mitigation group (basically 90 days to 180 days), their priority is to find a way to get you current not recoup the most that they can in a settlement.

One thing that my buddy did, and again he was in California so check your state laws as they may differ, but we have the "one action rule". So he continued to pay his first mortgage current (or current enough that they wouldn't take foreclosure action) and didn't pay his second mortgage a dime. This forced the second mortgage to foreclose the property. By foreclosing the property, they couldn't then sue him for a deficiency judgement as they've already taken their one action (foreclosure). They can't both foreclose and sue. He did this on multiple properties, one property he said it took a year and a half before the 2nd would foreclose it. I'm not necessarily suggesting this, but it's one way to put some pressure on a second mortgage holder, but again check your state laws because it may not hold true for where you live.

Sub: #86 posted on Fri, 05/07/2010 - 15:41

ball_mich ball_mich

(Posts: 360 | Credits: )

Hi

Just to let you know that you had taken the right decision to settle your debts.Settlement can only help you to pay off your debts or provide you with different repayment plans so that it becomes easy to pay off the debts in an organised way and also according to your financial limitations. I will honestly feel good if you keep me posted regarding the progress!!!!!!!!!

Sub: #87 posted on Mon, 05/10/2010 - 17:23

Rebecca Miller Rebecca Miller

(Posts: 131 | Credits: )

ball_mich,

Were the 2 loans your buddy had were with the same bank. From what i have read so far the Second usually charges of the loan and only under rare circumstances do they foreclose. I have read where 1st and 2nd were with the same bank and the second one foreclosed.

Thanks,
ssanthan

Sub: #88 posted on Tue, 05/11/2010 - 13:11

Unregistered


Ball_Mich, First off thank you very much for all your posts. They have been extremely helpful. I am to the point of charge off. I was working with a manager on a settlement for a $50k WF Heloc. Last week he said 10% would settle it. I called him back for the past week to say send me the paperwork and lets settle. After no luck of getting a hold of him I went to the operator and got a wonderful lady who tracked him down. The weasel would never get on the phone just spoke through her to say 10% was declined after he was the one that said it would work. The lady helping me took my info and said she would get to the bottom of this and see what they would take. She actually called back and said the manager said they will not settle for a dime under 20% and they are not open to negoiate on that at all. She then proceeded to tell me she would put that settlement offer in writing and send it out to me immediately.

My Heloc was not a purchase money loan and I wonder if I should just settle for the 20% to be done with it? Did they send a 1099 for the difference?

You are right, they would not budge on settling till after charge off. The first mention of settling was months agao and they never went lower then 65%. Thanks again for all your help.

Sub: #89 posted on Tue, 05/11/2010 - 18:26

Unregistered


Hi,

Are you still current on your 1st. Also what is the number that you called/faxed your information. I sent in an offer letter a month ago and nobody called. I am 4 months behind now.

Sub: #90 posted on Thu, 06/03/2010 - 10:10

Unregistered



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