Advice on settling second mortgage with SLS

antomax03

LoanSafe Member
Oct 18, 2016
4
0
1
30
Hello,

I am trying to settle my second mortgage with SLS. I stopped paying my second mortgage in 2010 but continued to pay the first.
I'm still receiving monthly statements fo the second but when I checked my credit reports, I did not find the second loan listed on any of the reports. Not sure if the loan is charged off or what.
I called SLS to inquire about offering a settlement amount on the second but they refused saying that anything less than 60% will be turned down for review. They also stated that I must provide financial information in order to submit any offers.

Bought the house in 2006 for $395,000
First loan is $265,000
Second loan is $81,000

The second loan used be serviced by BOA who were willing to accept my 3% offer back in 2014 but in the middle of the process, the loan was transferred over to SLS. SLS refused to consider any settlements back then.
Both loans are now serviced by SLS.

I am currently considering filing for bankruptcy.

Please help and advice!
 

Jzone

LoanSafe Member
Jun 20, 2017
157
19
18
69
Without bankruptcy protection, you are still liable for the debt. Credit report charge offs mean nothing really at this point. All that matters is who holds the lien to your property. Most states have SOL on secured debts, but many do not have SOL on mortgage lien. That means they can hold that lien forever.

First thing I would do is check with your county register of deeds and see who actually holds the lien on your property.

Do you want to keep the house? If not, file bankruptcy and move on. You do not want to be responsible for $350,000 house you dont want.
 

antomax03

LoanSafe Member
Oct 18, 2016
4
0
1
30
Jzone - thank you for the advice.
I will check with the county on who holds the lien. I know the investor is Deutsche bank national trust company.
Yes, I do want to keep the house.
I am just not sure how to deal with sls on negotiating a settlement of the second mortgage if they are not accepting a reasonable settlement amount.
 

Jzone

LoanSafe Member
Jun 20, 2017
157
19
18
69
Jzone - thank you for the advice.
I will check with the county on who holds the lien. I know the investor is Deutsche bank national trust company.
Yes, I do want to keep the house.
I am just not sure how to deal with sls on negotiating a settlement of the second mortgage if they are not accepting a reasonable settlement amount.
You have to look at it from SLS point of view. They are not going to settle easily and can wait it out for years. They have no incentive to take less than what is owed especially since they are owed the debt and not simply lein holders.

I filed bankruptcy 7 years ago and included both first and second mortgage. I have kept current on the first but have not paid the second in about 4 years. The second was with CitiMortgage and they sold/assigned the lien to United Guarantee about a year after I stopped paying.

United Guarantee sends me a letter about every 6 months with the total balance owed BEFORE bankruptcy. That balance means nothing to them or to me. The debt was discharged so the balance is ZERO. However, they hold the lien and could foreclose, but unlikely because in Michigan, the first mortgage holder must also be paid off during foreclosure proceedings.

When UG contacts me, I reply with a standard 10% settlement offer. My balance when I filed bankruptcy was $52,000. I offer $5,200 each and every time! No reply from them. I have no desire to sell the property but I know that if I want to in the future, this lien will have to be settled.
 

walkinginCLT

LoanSafe Member
Aug 31, 2011
17
0
1
Im in a similar boat.

1st Mortgage (rushmore servicing) $145,000
2nd Mortgage ( SLS Servincing) $ 39,000 (original principal)
Zillow says worth $247,000

Never missed 1st. Havent paid second in over 8 or 9 years. I couldn't tell you exactly because it has fallen off of our reports entirely. No record anywhere. We have purchased a new home in our new state and keep this home as rental property because when we moved it was underwater and we could not sell. Now, obviously, I'd like to settle this second. They (SLS) call once every 6 weeks or so. Refuse to talk settlement without financials, etc. They send statements occasionally (been quite a few months) that show the amount now is in the $70k dollar range. Back in 2016 they sent an offer out of the blue to settle for $12k, did not have anywhere near that available to settle then so it was a no go.

I'm interested in settling. Not interested in providing any documents whatsoever. I would be able to settle right this second for 50% of original principal but doubt they are going to accept that. Can't see them being willing to foreclose right now as there would be significant costs to get the zillow amount. I can threaten with BK but would definitely prefer not to go down that road.