How do I start to repair my credit after forclosure?
Submitted by chefcarlisle on Wed, 07/23/2008 - 1:05pm.
My house has been forclosed on in Nevada. The value of the house has dropped drasticly and it was on the market for 1 year. I could no longer pay the huge note. I had a 1st and a 2nd loan on this house. The forclosure sale only satisfied the 1st and now the 2nd is coming after me for 91K. They are willing to take a settlement at 41K. Do you think they will go lower than that? I also have huge cc debt (mostly from this house problem) that I am negotiating settlements on. How can I go about reparing my credit after all of this is over??? HELP!!! MY FAMILY NEEDS TO GET BACK ON TRACK!!
Comments:
There are a number of issues here, and given that you have some resources available to settle these things I would definitely suggest getting professional help.
Nevada does allow the sold out junior lien holder to come after you for the amount due on the loan per NRS 40.430. Note that many 2nds are sold to debt collectors for 5 to 10 cents on the dollar, and that you should start your negotiations in this range.
If you do agree to pay a settlement, you should also negotiate how the settlement is shown on your credit report - they may claim this isn't possible, but it absolutely is.
Given this debt and the credit card debt you may also want to consult with a reputable bankruptcy attorney to evaluate whether on not that is a reasonable option - it may very well not be, especially since it stays on your credit record for 10 years vs. 7 for foreclosure.
As for credit repair there are many services that offer to help, just be sure to get references check the better business bureau etc as many of these are not legit.
I still own a commercial building and a third of a cabin in Wisconsin. How do I keep these properties safe? If I make settlements will the creditors be able to persue me for any more money after the settlements?
Sounds like settlements may be wise since you have the assets and it appears they have the right to come after you. The key is negotiate a release of all claims as part of the settlement. Try to find an attorney that is familiar with foreclosure, judgements, and credit. They should be able to help you negotiate an agreement that leaves you free and clear and minimizes your credit damage (credit reporting and the release terms can be negotiated in the same way as the dollar amount).
So this is not something you suggest for me to do on my own? I feel like I can negotiate the terms. Wont I be ok it I get the documentation to back it up showing that the case is settled?
If not what type of lawyer do I call? Real Estate Lawyer??
Thank you so much for your advice!!
As one example, you'll want to be sure the settlement includes a proper release of all claims. Sometimes folks think they have that, bu really don't. For example banks sometimes don't include a release when agreeing to a short sale - and people are then surprised to have the bank still after them when they thought it was all behind them. An attorney would catch this sort of ommission, but if you are not familiar with the legalese of settlements you may miss something.
I'd probably look for a real estate attorney with trial experience as they are more likely to have negotiated settlements. Litigators are generally much stronger negotiators and are more initimidating by nature to the other side.
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