For unsecured loans and CC debt, I see creditors making a deal for cents on the dollar with debtors ONLY AFTER they have sued them and gotten a default judgment against them for the full amount owed and placed a judgment lien against their properties (which may be over-mortgaged, anyway). Usually, they do not try to foreclose right away.
For example, Chase has HUNDREDS of fairly recent and very recent default judgments (almost no def’s respond – what will they use for a defense?) filed in the SD South County Court alone. They bring some in for debtor’s examinations and some they work out payment plans with (no doubt for cents on the dollar). Chase (and other lg. commercial creditors) have to sue, serve, and get the judgment and work quickly in order to get ANYTHING out of the debtor before they become eligible to file a Chapter 7 BK where their judgment will be “wiped out.” Some lenders are pretty slow, but Chase has “down-pat” their factory lawsuit-thing going on.
It’s a race against time for these (formerly loose-lending) plaintiffs to recoup anything at all.
