A Deed in lieu of foreclosure is when a homeowner voluntarily turns over their property to the lender in order to satisfy a mortgage that is in default. A homeowner that is unable sell their home at the market value and is unable to make their mortgage payments may want to look into a deed in lieu of foreclosure as a means of preventing a foreclosure action. If you are approved for a deed in lieu of foreclosure by your lender, then the lender will promise not to begin foreclosure proceedings, and will cease any existing proceedings that may have already started.

A deed in lieu of foreclosure offers advantages to both the homeowner and to the lender. The main advantage to the homeowner is that rather than having their property foreclosed on, they are immediately released from the debt associated with their mortgage. The homeowner may also be given more generous terms with a deed in lieu of foreclosure than they would with an official foreclosure action. Although a deed in lieu of foreclosure is a negative mark on your credit report, it is less harmful than an actual foreclosure would be.

For the lender, a deed in lieu of foreclosure reduces the time and cost they would incur if they had to go through an official foreclosure proceeding. Deed in lieu of foreclosure proposals will most likely be rejected when made by homeowners who are still able to make their mortgage payments. Typically, before lenders accept a deed in lieu of foreclosure, they will require that the property is on the market for a certain period of time without being sold. Lenders would rather have the homeowner try to sell the home than have to sell it themselves through a foreclosure proceeding. Deed in lieu of foreclosure is a complex procedure, that if you decided to attempt, we highly recommend you have one of our specialists help you with.

At S.J. Packman & Associates, before we make any recommendations, our attorneys, certified debt specialists, and paralegals, are trained to ask the right questions to find out about your specific situation. Based on your current income and your financial hardship, we will determine which course of action will work best for you. We do not only offer one path, as there is no one process that can solve everyone’s needs. We will take our time with you and help evaluate what your best course of action should be. Call now and one of our advisors will be there to get you started on your path to financial freedom. There is no obligation to enroll, so don’t delay.