Is Cash for Keys the same as Deed in Lieu?

[Teddy]

Anyone know?

I'm asking b/c I requested DIL thru CitiMortgage and now I read that lenders offer $$ for Cash for Keys.

I vacated the house, have it up for sale - already BK'd it (no one will understand why I don't just let it totally go, but I don't feel right) - anyhow, I just wonder if it's the same thing.

Citi is having 2 appraisals done on the house, and I faxed them all the paperwork they needed. So, I should have an answer on my DIL request soon. I would have liked to have gotten some cash tho! I'm 4 months behind now on the pmts. I told them I moved to a cheaper place, which is true.

Thanks!

[endisnear]

No the cash for keys program is offered to have you *willingly* hand over the keys on XXX date for XXX amount of (taxable) money. It is offered to save the lender the time, hassle, and money of having to have you evicted. But if you're already out of the home and they offer it, well hey might as well take it!

[endisnear]

However i should add that i'm not sure if they'd offer it on a DIL since you are handing it back to them. I've only heard of it in foreclosures.

[Teddy]

Thanks - I did some more reading on it and you're right, they probably won't give me money.

Thanks!

[endisnear]

not a problem, glad i could help!

[krlklar]

what is a DIL?

What is a Deed in Lieu?
Advantages?

[krlklar]

Thanks,Sounds like a better deal for both instead of foreclosure.

[HHM]

Keep in mind, doing a DIL is still rare. Banks just don't want to assume the risk.

Keep in mind, if you have a 2nd mortgage, a DIL is a non-starter. Reason being, the Foreclosure legally quashes all inferior liens. The benefit of being able to inherit clear title is more valuable than the cost of the foreclosure.

[krlklar]

I'm pretty sure that the 2nd mortgagor hadn't started the foreclosure which was stopped by the chap.7 filing. Can the 2nd mortgagor stop the DIL?

[HHM]

It's not that the 2nd can stop a DIL per se, but that the First CAN'T do it if there is a second. The second has to agree to release their lien. Thus, the only other option is a foreclosure.

The whole purpose of the foreclosure is for the bank to legally retake the Title to the property. In order for the lender to "auction" the property, the property must be free and clear of any other liens. Part of the legal mechanism of foreclosure is that it automatically quashes inferior liens (i.e. the 2nd mortgage, judgment liens, etc). A DIL cannot do that. A DIL is simply an agreement between the lender and borrower to turn over Title back to the Lender.

[HHM]

Thats interesting, my first was bugging me to do a DIL even though I have a second...wonder why they were doing that with a second in place?

Well, maybe there is a mechanism in your State where a recorded DIL acts like a foreclosure such that it destroys the inferior liens. Or, perhaps the same "investor" holds both notes.

[freshstartfl]

Cash For Keys is being offered by some creditors because of the way a lot of people are destroying the home during the foreclosure process -- ripping out appliances, spray painting the walls, punching holes in doors, etc. This is a really huge problem these days, believe it or not, especially in Nevada. From what I've heard, they will offer something like $500 if you give them the keys and don't mess up the property.