I was in negotiation with the collection firm for a HELOC before I filed for bankruptcy, and managed to get a very low payoff amount. But due to the foreclosure auction, I had to file bankruptcy chapter 7 before it could be concluded. Now I am through my bankruptcy and did not reaffirm the loan. I emailed the collection firm to continue with the settlement, but they informed me the lender had recalled the account when I filed for B/R. They sent another email stating that they reached out to the lender and asked them to place the account back with them again so we could continue with the settlement. BUT, I am wondering if it wouldn't be better for me to contact the bank directly for a settlement, since I would think I could receive a lower settlement, without a third party being involved that would get a commission or percentage. This is very time sensitive, so I would appreciate your answers soon. Thank you.
You never know, but my experience is I get the better settlement deals with the collectors. Hope you have the good sense to bring in a professional with debt negotiating experience. Hope this perspective helps!
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Your best bet would be to hire counsel to settle for you...s/he will get the best results. Use the find a lawyer tool on avvo. Many offer free consultations. Good Luck!
I am a Massachusetts licensed Attorney. These answers are for informational purposes only.
Servicers don't get a percentage of the settlement. The answer to this depends upon the lender and the servicer. Some lenders (usually trusts) do not have settlement authority. Only servicers can settle. If the lender is a bank (Wachovia, Bank of America, etc...) you might do just as well directly, but the assumption that the servicer will take a piece of the action is not correct.
Posting questions anonymously and receiving general answers do not substitute for consulting with an attorney licensed to practice in the jurisdiction in which you live. Answers posted here by Kevin C Gleason are only intended for general education of the public on legal matters. Please consult a qualified professional before deciding what to do about your situation.
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