Collection Agencies And Liens
im attempting to get a discount on a junior lien that was originally held by citifinancial and then turned over to Regional Adjustment Collections agency. the payoff amt is 17k and they said the best they could discount is to 13k. i offered her over the phone 2k and she balked. i asked if they were willing to lose everything when the first foreclosed (and they will get wiped out!) vs getting 2k now? and she still didnt budge.
i am new to SS, and from all my readings i hear it is easy to get junior liens to discount big time. am i missing something here?
eric
You could've received the junior lien cheaply, however, keep in mind it's best not to insult the lienholder as well.
Perhaps you should have re-evaluated your offer before insulting them.
Tell the junior lienholders that the first mortgage is following FHA servicing guidelines and will not allow junior lienholders more than $2000 total. Cut your offer down to $500-$1000....
It has been my experience that junior lienholders will accept pennies on the dollar of what they are owed. Others may not have such experience.
was the loan current when it was sold by Citi? Is it current now?
Nothing in real estate is easy-- unless you compare it to having a real job.
There is a misconception/distortion that's being passed on as truth...
A juniors' lien (the Mortgage or other security instrument) may be extinguished at foreclosure sale.... but the personal obligation (the Note) survives....
Offering $2K may or may not be in their best financial interest if the Borrower has a bank account (account can be seized) or job (wages can be garnished).
[addsig]
the junior was in default when it was sold by citibank and cont. to be so today.
Have you given any thoughts to buying the first lien positions interest in the foreclosure and continuing with the foreclosure yourself on the front steps of your house where no one will likely show up? "Buy it" youself as a seperate entity (LLC or CO.) so it is not an REO and you can eventually sell it yourself.
We've considered this a few times when lien holders do not wish to settle - thing is, SSP is right the note survives it just gets wiped from the property. Your customer is going to have to pony up money some how - either to a BR atty or in other ways mentioned by SSP.
"Another Fine Twist You've Gotten Us In".
Don't be afraid to think out of the box. - Frostman
Quote:
On 2004-06-11 09:12, TheShortSalePro wrote:
A juniors' lien (the Mortgage or other security instrument) may be extinguished at foreclosure sale.... but the personal obligation (the Note) survives....
Offering $2K may or may not be in their best financial interest if the Borrower has a bank account (account can be seized) or job (wages can be garnished).
shortsalespro,
Let me make sure I understand what you are saying. Are you saying that in this case the property owner would still be liable for the amount owed and not Eric when he buys the lien or the property? I'm not sure I understand what you are saying, and would like to have a better understanding of how this works.
Thanks,
Robert
[addsig]
Allow me SSP.
:-D
The Lien is presently secured by the property, so that if the current owner were to sell the home, the lien would get paid from the excess monies out of proceeds of the sale through escrow...
However if there are no excess monies OR if the property goes to auction and either way - there are no excess funds available - deficiency judgment or liability for the outstanding balance due on the lien is likely going to be saught by the collection agency - for in this case outstanding debt on a collection account.
Interesting point I would like to interject here though... if an account has been placed with collections and no actual court judgment has been issued but the collection company merely assumed a debt and is serviceing that debt in lieu of the original creditor (Citifinancial ?) then there is a clock ticking for the collection company to secure the debt in court - or the debt can be null and void after the statute of limitations runs it's course in the state jurisdiction of the current home owner you're working diligently with to save. In Washington State the SOL is 6 yrs. In some states it's less, in others more. But that clock is ticking and if the debt is like 5 yrs and 10 mos old... I'd really check into how old it is.
I know that this thread may raise more questions than I gave answers to/for - but that is also another website forum to look up too.
Do hope I helped some.