"deed in lieu of foreclosure"

[fyi2]

anyone with exp.?

I am in the middle of a BK7 and 4 months of missed mortgage payments planning on surrendering the house in the BK. The bank called today to ask if i wanted to do a deed in lieu of to avoid having a foreclosure on my CR.

someone on another thread mentioned they had a brother who did a Deed in lieu and it still ended up as a foreclosure on his cr...

experience anyone?

[Trixie007]

A Deed in Lieu should be reported as such on the CR, and the impact is very similar to that of a foreclosure. Not a huge benefit to you except: 1) gets the whole thing over more quickly 2) in any future manual underwriting for a new loan it will show the lender that you did what you could to make the best of a bad situation, and they may look more favorably on you. The biggest benefit is to them, in that it saves them money. Personally I would have done this if it were possible since I never was out to "get" anyone when we went belly up.

[fyi2]

it does seem like the "right" thing to do
I confess though i could use a couple months to save for moving (rental expenses)

[HHM]

A DIL is just as bad on your Credit Report as a foreclosure, so that is not the issue. As pointed out, the reason to do a DIL is more to save time and hassle. They are great tool if there is an HOA, because it gets you out of post BK HOA dues more quickly.

It's good to hear that some people are still able to get DIL's, they are fairly rare. Many banks (or I should, many loan servicers) prefer foreclosure. The servicers like them because they get paid a lot of money to do the foreclosure.