If you are facing foreclosure, then I’m sure you’ve heard of a Deed In Lieu of foreclosure. Some people say it is a great way to avoid foreclosure. Actually, all it does is accelerate the foreclosure process.
Here are the most common myths about a Deed In Lieu.
Myth #1: If I do a Deed In Lieu in Cape Coral, then I will not owe the lender any more money. A Deed In Lieu is similar to a No Contest Plea. The judge stops analyzing the foreclosure case and simply schedules the foreclosure auction.
Unless otherwise stipulated, the lender still has all the deficiency and future collection rights. They may come after you for the loss.
Myth #2: A Deed In Lieu is better for your credit because you avoid foreclosure. It’s kind of sad to hear them say it. After you sign all the Deed In Lieu paperwork, then your house will still be sold at a foreclosure auction. Any person can actually bid on the house at the auction.
Myth #3: A Deed In Lieu is easy. This is absolutely not true. The process required a lot of follow up with the lender. Most lenders require you submit all your financial information. They want to make sure that you genuinely cannot afford the property. The process often takes between 20 to 40 hours over the course of several months.
First, you submit your paperwork. Then, you call your lender to make sure they received your paperwork. Then, you have to wait while they review it. Then, you have to answer any questions or provide more paperwork they request.
To me this is insane. Why not just live for free until your lender forecloses? A Deed In Lieu of foreclosure offers almost zero benefit to you. So, why go thru the aggravation? That is why I always recommend a short sale over a Deed In Lieu.
Thinking about a Deed In Lieu? Think about a Short Sale instead. I will be happy to explain how the process works in detail and answer any questions you might have. Just contact me….
Donna Bishop Realtor call (239) 560-3149 or email me: email@example.com
Thanks for reading this. I hope to hear from you soon.