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Deed in Lieu on 1st - after Charge Off on 2nd?

We're opting for the Deed in Lieu option with our 1st and we *were waiting to hear from our 2nd mtg company on a settlement (which they dragged their feet on), when we unknowingly hit 180 days – and they automatically charged it off.

My question is: is it better to negotiate a settlement (post charge off) with the 2nd mortgage company (Green Tree) – in a continued effort to do a DIL with our 1st?

Or the collection agency they might send it to?

If they send it to collections – who releases the lien?

(so I can prove to Mtg 1 that the property is free and clear)?

Their delay tactics seem unscrupulous - any impressions of Green Tree?

Thanks in advance.

  • December 06 2012 - Denver
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Answers (2)

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Thanks Alisa - are you suggesting bankruptcy to strip the 2nd lien?

I'm considering that as a last alternative, but would prefer to still attempt a settlement on the 2nd - so we could do the DIL on the 1st.

The account is no longer with Loss Mitigation - but with a Recovery (e.g. internal collections) with the 2nd.

Any precedent for how long they will pursue collections internally - before sending out to an external collection agency?
  • December 10 2012
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The 1st will normally not accept a DIL when there is a second.

You may be better off with a short sale after considering bankruptcy.
  • December 07 2012
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