Deed in Lieu - Walking Away

[mccaverty]

I just found a place to rent and am planning to be out of my house by December 1. The bank (credit union) just called me to talk about my "options" - they've been hoping to not foreclose, although the process is ongoing as I haven't been paying for a few months.

I don't know if I did the smart thing, but I told the bank guy what I'm planning and offered to give him the Abstract before I move. So, my question is, will giving him that affect my ability to stay in the home until December 1 (I haven't paid my mortgage since August), or should I hold onto it until I move? I'm not quite sure what benefit there will be to me of arranging a "deed in lieu..." since the house was IIB.

[DeadManCrawling]

What state are you in? If your only goal is Dec. 1st, you are probably okay in nearly every state.

If you have further hopes, please share more details. State, bank, amount owed, equity and so on.

[mccaverty]

I'm in Iowa, the house would probably sell for about $20,000 less than the amount of the mortgage. I don't owe anything, since the house was included in the bankruptcy and I didn't reaffirm.

If they go through with foreclosure the only downside to me is embarrassment of having a foreclosure sign or being served. On the other hand, there are things I can do to delay the foreclosure process and continue to stay in the house. Whether they foreclose or we do the deed in lieu, the bank is more than likely going to lose money when they sell the property.

I don't want to be a jerk to the bank, but at the same time I want to be able to stay until I can move into the new place (probably Dec. 1 or Jan. 1)...and that's the reason for my question...I don't know whether agreeing to the deed in lieu puts me in a weaker position. In other words, if I give them the abstract, are they going to say, "Sure, you can stay!" and then next week have the power to evict me?

[DeadManCrawling]

You have plenty of time, at this point. Have you received the NOD?

If not, things will move slow enough, even in nonjudicial states, to allow you at least until Jan 1. Not sure if IA is judicial or non.

Check out the foreclosure timelines stickie at the top of the forum.

Most states take a long time.

[mccaverty]

Yeah - it's moved from NOD to Notice of Acceleration, and it was soon after that when I found the place I hope to be moving into in a month or two, and that's when I felt more comfortable talking to the bank about doing the deed in lieu - which I think will entail some form of agreement, although I don't know how binding it will be.