HELOC Negotiation

[Lanph]

I have a HELOC that I have not paid on for quite a long time. We had our first court date and were unable to come to an agreement, so a new date is scheduled where they will attempt to get a judgement. We will be unable to file bankruptcy until after they would start the wage garnishments from the judgement.

I would like to try and settle to avoid the judgement and garnishments by hinting to them that we will be filing BK in a few months. If I let them know that I plan on filing is there anything they can do to either stop the BK, or accelerate the garnishments?

Has anyone one ever got a settlement this way? I am in WI and dealing with Wells Fargo

[justbroke]

Letting them know that you'll file bankruptcy, will generally send a creditor running to the court to expedite a judgment and then garnishment... so that they can get something. Not everyone that threatens bankruptcy actually does it. A bankruptcy is not a bankruptcy until it is filed and discharged.

It would be interesting if they would do a settlement before it's discharged. I'm sure they probably would, but the interesting part would be at what percentage. While discharged HELOCs (and seconds) have been settled for as little as 5%... most are about 10%. For a HELOC that still has the ability to be collected, I just can't imagine how much they'd want to settle.