Does Charge Off Kill A SS?
I have a Short Sell that I have been working. The FMV is around 90k. The first is 74k. The second is 33k. the first is protected and will not short. The second sent out a BPO on Monday and yesterday they charged off the loan. I am not sure exactly how a charge off affects my ability to negotiate. The loss mit person said they are no longer involved although they still have a lien on the property. The loss mit person gave me the number of the third party in charge of collecting the debt. I am faxing the third party a authorization. Does anyone have experience working a SS after a charge off? Can I get a partial release of lien for some payment and still get the house sold?
Thanks
Brenda
Treat the 'collector' as if they were the second lienholder... because they are. Simply because the lender charged off the account doesn't mean that they don't want their money. They have a valid lien.
Yes you can. I just had one where the second for $23k was charged off. They accepted $1,000 for release of lien. Offer the collection company $1,000 for "release of lien" only (and not for satisfaction of the debt). Make a point to the collection company that if the home goes to sale, the lien will wash and they will get $0. $1,000 is better than $0 and they can still pursue the mortgagor for the debt.
One more thing... clarify if the collection company purchased the debt or collecting on behalf of lender. In the latter, you would need to offer 2nd Mtg $1,000 for release of lien (not collection company)
The Charge Off is actually staying within the bank. It is now in the Recovery department. And the recovery department has their own SS procedure. Working through it now.