Thanks for you in-depth reply; the mortgage though has gone through.
I only need info on negotiating with my creditors after judgment has been rendered and Writ of Seizure filed.
I have only a few days to do this.
Thanks again.

When you begin to negotiate or renegotiate a mortgage with a lender, there are several tools that a lender will use before a mortgage application is approved or declined. In addition to the usual Credit Report and Credit Score, the lender will perform a calculation known as a Debt-to-Income Ratio. The purpose of this calculation is to determine if you have enough income to service the mortgage.

A debt-to-income ratio ( often referred to as DTI ) is defined as the percentage of a consumer's monthly gross income that goes toward paying debts. Strictly speaking, DTI's cover more than just debts. They cover any monthly payment that you are committed to pay, such as rent, mortgage payments, condo fees, insurance, etc. More about these costs later.

There are two main kinds of DTI and they are expressed as a notation such as x / y for example 28 / 36

1. The first DTI, commonly known as the FRONT END RATIO indicates the percentage of gross income that goes towards housing costs, which for renters is the rent amount and for homeowners is the PITI ( mortgage principal and interest, property taxes and mortgage insurance premium { if applicable } ) together with condo fees, property insurance premium and homeowner association dues { if applicable }.

2. The second DTI, commonly known as the BACK END RATIO indicates the percentage of gross income that goes towards paying off recurring debt payments, including those included in the first DTI and other debts such as total minimum payments on all credit cards, car loan or car lease payments, personal loan payments, line of credit payments, cell phone payments, student loan payments, monthly payments ordered by the courts and alimony and child support payments.

All major Canadian banks require a DTI of 28 / 36. This is a standard within the banking industry. Some private lenders may grant a mortgage with a slightly higher ratio, however, they will compensate by charging a higher rate of interest.

EXAMPLE

In order to qualify for a mortgage for which the lender requires a debt-to-income ratio of 28 / 36

Yearly Gross Income = $60,000 / Divided by 12 = $5,000 per month

$5,000 Monthly Income x .28 = $1,400 allowed for housing expense

$5,000 Monthly Income x .36 = $1,800 allowed for housing expense plus recurring debt.

I hope that I have outlined how lenders evaluate your financial position in determining whether to issue you a mortgage.

-------------------------------------------------------------------------------------
Educating one Consumer at a time

Sorry, in my last post, if not already corrected MBNA should instead read Canaccede.

Thanks for your knowledgeable response.
In my haste and desire for brevity and simplicity I failed to include that Canaccede has already registered a Writ of Seizure and Sale of Land. So has the CIBC (1st and 2nd mortgage, a $50,000 secured line of credit) earlier, and then TD ($55,000 unsecured line of credit) soon after. We're attempting to settle with everyone. Also, we are close to finalizing a new first mortgage with a private lender. To complete this, as you stated, all judgments and mortgages will first need to be paid off.

So the challenge as I see it is to attempt to get better settlements with each creditor - even though each has already filed a Writ and likely knows the amount of our current mortgage but probably not the value of our house (except CIBC) because we built it on land we purchased for $300,000. None knows that we are about to renew our mortgage and all aware that we are in debt about $500,000. Interestingly, the CIBC who knows they can get 100% on their 2 mortgages but maybe not much on another $51,000 debt (unsecured and not yet gone to judgment), is willing to negotiate a settlement pending my completing a Financial Capacity Assessment.
I hope I've not made this too confusing.
Any and all comments are greatly appreciated. Thanks.

Negotiating with MBNA is a total colossal waste of time because they no longer own the account.

Why would Canaccede negotiate on a judgment obtained for $80,000 when they know or should know that you and your wife own a house valued at 1.2 million with about $850,000 equity? Unless their legal department or outside law firm have the mentality and business acumen of "The Three Stooges", you can expect a Writ of Seizure and Sale ( i.e. a lien ) registered on your property immediately if not sooner. If I was the lawyer representing Canaccede, I would be at the Superior Court of Justice the morning after the judgment was obtained with Motion in hand requesting an Order from the judge for a Writ of Seizure and Sale. Once obtained, I would then make a "beeline" to the Registry Office to register this Writ against the title to your property.

If this registration of the Writ has not occurred, it will. What this will do is it will be IMPOSSIBLE to renew or renegotiate your mortgage until this Writ is discharged ( paid ) including legal fees to both register and discharge the Writ. Your current mortgagee may consider paying out the Writ and then adding it to a new mortgage. I strongly urge you to contact your mortgagee and discuss this Writ with him/her. If your mortgagee does not want to get involved, start looking immediately for a new mortgagee. You will have to deal with it so get prepared now before your mortgage comes up for renewal.

----------------------------------------------------------------------------------------------------------
Educating one Consumer at a time

Canaccede, an MBNA account purchaser, recently obtained judgment for $80,000 against me.
Today I offered to settle for $10,000. They have asked for a list of my assets and other judgements. They are not interested in financial needs assessment.
The problem is that my spouse and I have about $850,000 equity in our house (valued approx. 1.2 million). Our mortgage, originally $550,000, is now $360,000.

On what pretense could I avoid financial disclore without risking reaching no settlement?

Would attempting to settle with MBNA directly be beneficial?
There is some time constraint on our end because we are in need of obtaining a new (much larger) first mortgage.