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What exactly is a "Discount Payoff Agreement", from a mortgage lender?

Queen Creek, AZ |

Ocwen loan services, is offering a discount payoff of $15,000. With a release /satisfaction and a discharge of the Deed of Trust/Mortgage. What does this specifically mean. That you are able to keep the home, or is it just releasing you from the debt owed. It also states "If necessary Ocwen will file a withdrawal in connection with any legal action it may already have taken, as of the date of your response to his letter , to collect this obligation.

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Attorney answers 3


This sounds like an agreement to cover a deficiency judgment. Take the paperwork to a local lawyer before signing anything this may not be what you think. Use the find a lawyer tab above to find a lawyer near you to take a quick look.
Good Luck

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OCWEN is great at sending these letters out. I have had many clients receive them, sometimes it makes sense to move forward with it, and other times you want nothing to do with it. If you like you can send it over and I'll look at it for no charge. We are in Tempe, AZ.

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I will fax it to you today. Thank you.


This is Ocwen trying to get some cash out of you rather than facing either the option of taking title to your property through foreclosure or seeking collection of a deficiency judgment. I agree with the other posting attorneys that you need to discuss this with an attorney as there are a few issues potentially involved. You may be protected by the anti-deficiency statute, which would potentially make the offer worthless and actually worse than Arizona law or you may be offered an opportunity to keep a property that would otherwise be foreclose upon. You also need to consider the tax implications of your situation as you do not say what balance your loan has and whether or not the agreement will result in you being taxed on forgiven debt. Contact an attorney and your accountant to get a full examination of the situation before you decide to listen to the offer.

Disclaimer: This answer is provided for informational purposes only, does not constitute legal advice, and does not create an attorney-client relationship. I am licensed in Arizona and can only provide general comments on matters outside of Arizona law. Actual legal advice can only be provided after a direct consultation in which all of the relevant facts are considered before providing a response.