The Moher Law Group has successfully negotiated settlement on debts and second mortgages for clients throughout California. Debt settlement can be a very useful option in several distinct situations.
When Would Debt Settlement Work Better than Bankruptcy
Under many circumstances, bankruptcy is a more effective solution than Debt Settlement. It is usually faster, it guarantees that your creditors have to work with you and the court, it avoids tax consequences that settlements often entail, and it can help reorganize or eliminate struggling mortgages, car loans, and tax debts.
There are certain circumstances, however, when debt settlement can be more effective. If you have just a few debts, have resources to pay a lump sum settlement, and the creditors are willing to work to settle the debts with you or your attorney, debt settlement can sometimes be cheaper and more effective than bankruptcy. To know which is better, it is important to analyze your income, expenses, assets, resources for settlement, and other information that will clarify your bankruptcy and settlement options, and what the creditor is likely to accept as far as a settlement.
Working to Settle Second (and Third) Mortgages
If you have a second or third mortgage that is encumbering your home, and it is hurting your cash flow or lessening the value of staying in your home, it is worth looking into settlement of the 2nd mortgage. You will need a source of money to settle the account. I have recently obtained settlements for less than 10 percent on a second mortgage that had no equity, and less than 25 percent on a second mortgage that was almost fully secured (the house was worth as much as the first and second mortgages combined, so the second mortgage had little reason to negotiate). Results always depend on the numbers and making the right choices. Before attempting a settlement on a second or third mortgage, it is always good to evaluate a possible chapter 13 bankruptcy, to see if you can achieve a lien strip and strip off the second or third mortgage completely through a chapter 13 plan.
Contact us today to discuss your options.