When you are the lender, YOU are in charge. It sounds obvious, but you would be surprised how often borrowers forget it, and how often lenders let them.

We are living this right now with a non-performing loan we acquired. The borrower has decided they are running the show. They want cash for keys based on full property value, are ignoring default interest entirely, and are claiming that because we bought the loan at a discount, that discounted price is all they owe us.

Let's clear that up fast. It doesn't matter what we paid for the loan. The borrower signed a note for a specific amount with specific terms. That obligation doesn't shrink because the loan changed hands. We are their current lender, and the contract is the contract.

Cash for keys at full property value isn't a negotiation. That's a ransom demand. And going silent on default interest doesn't make it disappear.

This situation comes down to one thing: discomfort with conflict causes lenders to lose their leverage. Be professional, be firm, document everything, and remember that foreclosure isn't a threat. It's a legal right.

The lenders who get walked on are the ones who forgot who was sitting in the driver's seat.

How do others deal or handle this?