Some home owners who are in distress may choose the option of a Deed in Lieu instead of a short sale. The home owner gives the deed for the house back to the bank and can walk away from the house without having to worry about having to do a short sale. A Deed in Lieu benefits the lender since the lengthy foreclosure process can be avoided.
The home owner can walk away and the bank may not seek a deficiency judgment (money bank has lost on the mortgage) since the owner gave up the property. If the distressed home owner has equity in the home, a Deed in Lieu may not be the best option. The bank has to approve a Deed in Lieu and if the home has more than one lien, it may not be accepted.
A Deed in Lieu is reported on an individual’s credit report and in some instances can be viewed the same as a foreclosure. There are alternatives to foreclosure, contact a real estate agent in Colorado Springs who is experienced.
Colorado Springs Real Estate Agent, Patricia Beck, providing real estate services to home buyers and sellers.