What is a deed-in-lieu of foreclosure?"
A deed-in-lieu of foreclosure means that, in order to be released from your mortgage, you must transfer ownership of your home to your lender. If you choose this option, a U.S. Department of Housing and Urban Development (HUD)-approved housing counselor can help you plan your next steps.
Borrowers who are considering a deed-in-lieu of foreclosure should also ask their lenders or servicers about help with their relocation expenses, either under the federal government’s Home Affordable Foreclosure Alternatives Program (HAFA) or other private programs that are sometimes called “cash-for-keys.” The deadline to apply for assistance under HAFA is December 30, 2016.
If you live in a state in which you are responsible for any deficiency between the value of your property and the amount you still owe on your mortgage loan, you will want to ask your lender to waive the deficiency. If the lender waives the deficiency, get the waiver in writing and keep it. For help in exploring your options, call the CFPB at 1-855-411-CFPB (2372) to be connected to a HUD-approved housing counselor today.
Use our checklist for more information on how to avoid foreclosure.