Equity Loan Settled with WF!!!

[CCCrazy]

I received the good news today over the phone today - WF is settling the home equity loan at 10% of the balance with a full lien removal!!! So they get $4,228. Of course, I'll really celebrate when I have the acceptance letter in my hands.

As far as county records go, what should I look for? I checked and the equity loan is listed online. So when they release the lien, will it say something like "Mortgage Release"?

I just wanna thank everyone on BK Forum - your support and advice has been a great help to me over the past year. I look forward to helping others on this forum. THANKS!!!

[StartingOver08]

It should say something like "Satisfaction of Mortgage"/ Release of Lien. Make sure it is recorded in your County records. Once it is paid, you should receive the original signed recorded release within 4 to 8 weeks. If you do not get it, follow up with the lender. You should be able to check your public records on line to show that it is truly recorded.

BTW, congratulations! You did a great job

[parkd]

Why didn't you just include this with your BK last year or did you not give up the house?

[CCCrazy]

Why didn't you just include this with your BK last year or did you not give up the house?

It was included with the BK - which is why they even considered my offer. I did not reaffirm either my first or second mortgage and I've continued to pay the first mortgage on time since I want to keep the house. But I told them I was going to walk unless we settled on the second and they removed the lien. Obviously I was not going to stay in the house with a second lien accruing interest.

[parkd]

So if it was included then why pay it? I'm confused. Please forgive me also as I am not sure what reaffirmed means either as I am a noob when it comes to BK and am only here due to my wanting to short sale my house and see what the ramifications are and whether or not I'll have to BK if the bank comes after me for the deficiency. Do you have to pay the 10% because you still want to keep the house and don't want it to slide into foreclosure? I am the exact opposite. I want to keep everything else I have and just ditch the house since the neighborhood turned very bad with section 8 renters and illegals and the city's home values are down 50-70% from peak. Paying my mortgage isn't the problem for me either as I can afford it, it's the fear for my safety and my valuables and not being able to sell and get away from here due to such extreme property value drops in my city. I have a $20k 2nd as well which will complicate things and would like to settle that for 10c on the dollar if possible. I don't want to claim BK due to a short sale but if wells comes after me for the deficiency then I will have to. What are your tax implications for this settled debt? I'd appreciate any info you could give.

[CCCrazy]

My tax implications are zero since the equity loan was discharged in my BK. When a first or second mortgage is discharged in a BK, the lien still remains on the house. So why would I want to continue paying my first mortgage while a second lien is sitting on the house accruing interest for the next 30 years? I told WF settle the equity loan and remove the second lien or im walking. I want to keep my home and now I will since I will only have one lien on the house. If I walked the bank can't come after me for anything since both mortgages were discharged in BK. Hope that helps.

[parkd]

Ah yes it does. Thank you for clearing that up. Since I could care less about keeping my home then there would be no reason for me to settle with them. Is it better to short sell and claim BK 'IF' wells comes after me for the deficiency or better to BK first and include both primary and equity loans on the home and then short sell?

[StartingOver08]

If you BK first, there is no need to do a short sale.

[marchelala]

Is your first with WF also? How long you did not pay on the second before you settle ?
Sorry for all these questions - but we are in the exact same boat:

1st (BOA) adn 2nd (WF) not reafirmed in ch7, 2nd completely underwater and I wantto settle with them ... but I am chicken when it comes to not paying a mortgage... (I know, I know)

[CCCrazy]

Is your first with WF also? How long you did not pay on the second before you settle ?
Sorry for all these questions - but we are in the exact same boat:

1st (BOA) adn 2nd (WF) not reafirmed in ch7, 2nd completely underwater and I wantto settle with them ... but I am chicken when it comes to not paying a mortgage... (I know, I know)

My first is also with WF. I stopped paying the month I was discharged - so that's 9 months of not paying. If your second is completely underwater and it wasn't reaffirmed, stop paying it and start saving that money to make a 10 percent offer. WF would have to buy out BoA to foreclose on you and that's not going to happen.

[upward]

This is so helpful! We are also with Wells Fargo and discharged our 1st and 2nd in the Bk. We were discharged 2/08. We have been making the payments, since we wanted to stay in the house, and we have lived in the neighborhood, raising two kids for the past 15 years. Anyway.. Just got statement from WF that our 2nd is a balloon payment owing 71K! The 2nd is totally under water so I am not going to make anymore payments. We have just started hearing about others negotiating 10% of loan. How long did it take you to get this all settled? Thank you for all of your responses. This forum helped through the BK two years ago ,and now I'm back getting help again.

[CCCrazy]

This is so helpful! We are also with Wells Fargo and discharged our 1st and 2nd in the Bk. We were discharged 2/08. We have been making the payments, since we wanted to stay in the house, and we have lived in the neighborhood, raising two kids for the past 15 years. Anyway.. Just got statement from WF that our 2nd is a balloon payment owing 71K! The 2nd is totally under water so I am not going to make anymore payments. We have just started hearing about others negotiating 10% of loan. How long did it take you to get this all settled? Thank you for all of your responses. This forum helped through the BK two years ago ,and now I'm back getting help again.

Amazingly, it took only one week. I was stunned since I've only heard terrible things about WF negotiating stuff like this. Their acceptance letter was waiting for me yesterday via FedEx when I got home last night. I'm going to wire them the money to get this done as quickly as possible and to protect against any "we haven't received it, it may have gotten lost" scenarios.

[marchelala]

Thanks for you reply

Did you described the steps you went through anywhere in this forum? I would love to see the excact steps...
I wonder what is the worst case scenario is ou stop paying the 2nd..

[blncd1]

Thanks for you reply

Did you described the steps you went through anywhere in this forum? I would love to see the excact steps...
I wonder what is the worst case scenario is ou stop paying the 2nd..

likewise, would love to know because i have been dealing with wf on the first for 2 yrs and they are a nightmare.

[upward]

I would also like to know how to get started with this. We were 2 months behind and before I knew about the balloon payment coming due I sent them two payments, being scared they would start foreclosure process. After reading all of these I wish I hadn't sent it! I'm not going to make anymore payments and see about the payoff. We owe 340K on the first and the house is probably worth 320K maybe. The second at 71K would get nothing.
Thanks for all of the great input!