Part of my short sale agreement included a promissory note through United Guarantee for $18k. The short sale negotiator recommended making a cash settlement offer days after closing. Does anyone have advice for the best way to go about this?
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If you "settle" then it will show on your credit report as "Settled for less than the amount due" as of the new date. That will remain on your credit report for 7 years. If you are going to settle, I would suggest you work it out that they completely remove any negative reporting from your credit report and report the Debt as "Paid in Full". Also, only pay by check and on the reverse / endorsement side of the check write the following:
"By endorsing / depositing this check, payee agrees that [Name] account is hereby Paid in Full and, payee and its debt collectors immediately retract any and all collection activity. Further payee agrees to completely and immediately remove any and all negative reporting regarding [Name] from all Credit Reporting Agencies without remarks or dispute. Payee agrees this debt has been Paid in Full. If any of the statements contained herein are altered, this check is void. This check is valid only for 30 days from date of issuance."
This has been successful for clients of mine. By using the above language - they have two choices; 1) agree and cash the check before the expiration date; 2) don't settle and return the check which you will keep for future reference..... :-)
Good luck !
Thom Colby
Broker / Owner
Thanks for the advice.
Any strategies or advice on how to actually make the offer to settle?
Roger,
Is the information your looking for in regards to how you should proceed in making an offer to settle the promissory note after closing? Are you planning on accepting the agreement along with the promissory note?
Brett@ishortsalenow.com
310-564-6389
www.ishortsalenow.com