Nowadays a lot of people are investigating deed in lieu of foreclosure.
In this process which is also called grant deed in lieu of foreclosure, or just deed-in-lieu, you give your property back to your mortgage lender the easy way. You sign a grant deed transferring title to your lender.
In return, the lender stops the foreclosure that is going on.
You do not need to be in foreclosure to do a deed in lieu. But lenders won't pay attention to you in many cases unless you are in foreclosure or at least are delinquent. This is not always the case, though, depending on the lender.
What people do not realize is that certain points must be negotiated when you talk about a deed in lieu with your mortgage lender.
How will they report your credit to the credit bureaus?
Most of the time, unless you negotiate otherwise, a deed in lieu is reported as a foreclosure. It's no better on your credit report than letting your house go to a trustee sale or sheriff's sale.
The mortgage company will insist that they can't do anything about this, but they can. They can report, ideally, "PAID - SATISFACTORY" but if they are unwilling to do this, "PAID - SETTLEMENT" is okay too. You don't want a foreclosure on your record. The lender can't do anything about a public record but they can change how they report your credit.
Ask them about "unrated" or R0, which is even better. The loss mitigation person may not know what this is but it is really nice because it removes any late payment reports and other derogatory information.
The other thing you can negotiate is that they will not pursue you to cover the deficiency in what they get when they finally sell your house, and what you owe. This is crucial because otherwise what is the sense of doing deed in lieu of they expect you to pay for their financial losses?
Remember that deed in lieu doesn't solve your lender's problem. They want the money not your house. If they accept your deed in lieu of foreclosure, they must fix your house and sell it. That can cost them a lot of money.
Some estimates are that lenders recover only $0.68 on the dollar lent out when they do a foreclosure. So you can see why the last thing they want is your house.
That's why I suggest you check out options. Consider whether you should instead do a short sale or a deed in lieu of foreclosure or perhaps must sell your home in nine days even where there are seemingly no buyers
I wish you the best of luck in your situation and although I wish I could be more encouraging about a deed in lieu of foreclosure, short sales are more likely to pan out for you these days.
About the Author:And take Richard Geller's instant free 20 minute online course at http://www.HomeSaleRelief.com that many others have found helpful -- inside information on how to stop foreclosure, improve your credit, slash your other bills without bankruptcy, even buy a new house with little or no money down.
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Spouse's Nursing Home Care Will Bankrupt Us
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During the last few months, my husband has suffered a series of strokes and had to be admitted to a nursing home. While he was in the hospital, I was able to meet the financial obligations of our mortgage payment, utilities and food on his social security and my small pension check. I was working a mediocre job prior to his illness but have had to take family leave, which will run out in 2 weeks, at which time I will also lose my health insurance. I have listed my home but fear that it will not sell quickly enough to save it from foreclosure when the nursing home starts billing me $4000-$5000/mth. Home health care is not affordable and my husband requires care 24/7. My husband is aged 71 and I am 61. What can I do to avoid losing my home and still pay for my husband's care?
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