What Is a Warranty Deed In Lieu of Foreclosure?
If you are facing the possibility of losing your house, knowing the answer can perhaps make the difference between an expensive and drawn-out legal process and a speedy resolution to the problem. A deed in lieu of foreclosure may be a better alternative. The Definition Of A Deed In Lieu Of Foreclosure When a homeowner has fallen behind the monthly payments and is in foreclosure proceedings with the lender, he can sign a deed in lieu of foreclosure. This legal document transfers the ownership of the property to the lender and gives all rights and interests to the lender. The lender will then try to sell the property to get back money to offset the loan. How It Works The deed in lieu of foreclosure transfers the property back to the lender. This stops foreclosure proceedings, as that process is the legal attempt to gain control of a property due to defaulting on the loan. When the property reverts back to the lender, the loan is considered paid and the debt is cancelled. There are taxes
