Voluntarily surrendering ownership of your property to your lender in order to satisfy the amount you owe on your first mortgage is one of the most practical ways to prevent them from foreclosing on the property. A Deed in lieu of foreclosure or simply deed in lieu not only helps you avoid public sale or auction of your property, but also helps you rebuild your credit sooner than you would than after going through a foreclosure.
For help with your deed in lieu in Gainesville, contact us at The Law Offices of Justin McMurray, P.A. for a free consultation. We specialize in bankruptcy and foreclosure defense, and we can help you avoid creditor harassment and other debt woes. We help you find relief from your financial stresses and hardships through various kinds of legal defense tools at your disposal, ranging from short sales to deeds in lieu, and bankruptcy filings.
Deed in lieu of foreclosure allows you to convey all interest in the real property to the lender, in order to satisfy the loan and avoid foreclosure. For your property to be considered for a deed in lieu, indebtedness must be secured. Both sides must also enter into the agreement voluntarily to ensure good faith of the transaction. The agreement must also have total consideration that the settlement is at least equivalent to the property's fair market value.
In some cases, the lender may not agree to proceed with the transaction if the borrower's outstanding debt is more than the property's current fair value in favor of a short sale of the property.
In Gainesville, deed in lieu transactions are voluntary—i.e.,lenders will not act upon the action unless they were offered such a conveyance by the borrower. Furthermore, the written offer must state that the proposal to enter into the negotiation is indeed voluntary. This protects the lender from subsequent claims that they acted in bad faith or that the borrower was pressured into such a settlement.
Until both sides reach a final agreement, neither the lender nor the borrower is compelled to proceed with the transaction.
Eligibility for this depends on:
- The causes of your financial hardship (medical expenses, reduced income, divorce, etc.)
- Your inability to afford current mortgage payment
- Your inability to modify current mortgage so that it can be more affordable
- Whether or not you attempted to sell the property prior to the deed in lieu.