What is a Deed in Lieu of Foreclosure

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You are facing foreclosure. What are your options?

The most obvious choice is bankruptcy. A Chapter 7 bankruptcy would apply if you no longer wish to keep or can afford to keep your home.

Chapter 13 assuming you qualify, would be an option if you wish to save your home. A payment plan is structured where the arrears are paid back on top of your monthly payments.

I previously discussed a loan modification of your mortgage, and that is when new mortgage terms are negotiated with the lender.

Read: What is a Mortgage Modification

But a deed in lieu of foreclosure is another option that could work favorably for all parties involved.

A Deed in Lieu of Foreclosure is when the bank agrees to stop the foreclosure process or not even start it, in return of you leaving the property voluntarily. In exchange, there are usually terms and conditions such as cleaning up the property before you vacate it.

My experience has been the terms by the lender are usually minor such as not leaving behind personal items and making sure to clean the inside of the property.

The best part of a Deed in Lieu of Foreclosure is that lenders are sometimes willing to not only pay attorney’s fees for negotiating the contract, but also pay the homeowners to leave.

I’ve been able to negotiate terms at times up to $10,000 for the homeowner to receive in exchange for leaving the property.

Facing foreclosure and want to know the next step? Then contact attorney Alex Hernandez and schedule your appointment. Saturday consultations available.

Attorney Alex Hernandez

Representing clients in the areas of Chapter 7 Bankruptcy, Family Law/Divorce, and car and motorcycle accidents for 20 years. (904) 712-5565 or (305)-688-LAWS (5297). *Se Habla Español

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