What You Need To Know About Deed In Lieu Of Foreclosure…

There are quite a few homeowners that are unfortunately mis-informed about deed-in-lieu of foreclosure. The deed-in-lieu of foreclosure means exactly how it sounds. The homeowner gives the deed to the bank just in time to save the crushing blow of a foreclosure. Right?, Wrong…and let me tell you why.

We are working with a very wealthy client that is in foreclosure on 2 of their high end homes. They decided to not do a foreclosure and called their bank. They offered to give them the deed to their homes. The bank would not accept the deeds. The homeowners were shocked and stunned. They couldn’t understand why the bank would not willingly take the deeds instead of going through the expensive foreclosure process.

The bank wanted the homeowners to find a buyer for their homes. In other words, Short Sale. The bank did not want any part of the debt on these 2 homes. The homeowner then contacted us to handle the short sale. They have successfully completed a short sale on their investment property. The other home is their primary residence which will be sold by the middle of next month.

Let me add more information to why banks are not taking deed-in-lieu. They want a deed free and clear of all liens. An example of what some common liens are, IRS for unpaid taxes, property taxes, unpaid HOA dues, and contractors lien. This is why they don’t do deed-in-lieu of foreclosure. They want a clear deed.

This is current information gained from a “HAFA” certification I went to last week. Doing my best to keep you informed with current bank information.

If you are reading this and know of someone that may need our help please send this to them, or call 310-737-8173 for a confiential call.

We help people move gracefully out of uncomfortable financial situations with their homes.

Kristine 🙂