Is it possible to get another loan after DIL on first loan?

Hi Lucille.

I have answered your question at http://www.mortgagefit.com/foreclosure/dil-lien.html#56198

Feel free to ask if you have any further questions.

Best of luck,
Larry

I have had my home for sale for about eighteen months, I work ninety miles one way from home. I have received a promotion but it requires me to live in the same town as where I work. I haven't had any luck with the sale of the home and now I am going to have to pay rent on another home when I move. The cheapest rent is seven hundred fifty a month. There is no way I can pay my mortgage and the rent. Would deed-in-lieu be a good option?

Hi R Smith,

It's great that you received a promotion. :)

Now, considering the house isn't selling, what you can do is, rent it out for some time till the market gets better and then you can sell it off to a potential buyer.

Alternatively, you can offer a lease to purchase option also. I feel lease to purchase is better than going for a deed in lieu, losing the home and getting your credit tarnished.

Get an idea on how deed in lieu affects credit.

Regards,

Jessica.

I have a beach condo that I now can't afford. My wife just had twins so she is no longer working. The mortgage is for 220,000. The agent said that it would only appraise around 180,000 (if it sold). I am current on the mortgage now but its killing me. This seems like the best option, is that true? Is it possible that the bank would assume the difference?

Hi Rodney!

If the lender does a short sale, then he may file a deficiency judgment against you and ask you pay off the deficient amount. If you cannot pay off the deficiency, then the lender may place liens on your other property or can garnish your wages.

If the lender agrees for a deed-in-lieu foreclosure, then he may forgive your deficient amount. I would suggest you to first speak to the lender and check what is he offering to you.

Thanks.

I am a single mom of 2 special needs kids that can't get any gov't help since I own a home and the children get child support. I do get 1500/mo child support and this is my only income. My heath ins. is 850/mo since I am unemployed with pre-existing issues. I need to get rid of this home within 3-4 months, move to my parents home with them while I go back to school. I have a 1st mortgage and a 50K HELOC and am now upside down on home. I have no CC debt or other non-home related bills. (elec. water, etc.) Can/should I file for deed in lieu and will that include the HELOC or is that a seperate issue? I am not currently late on any of the 2 pmts. yet but will be soon on the 1st mortgage. I have no savings and want to know if I will be responsible for any money that isn't recovered if I just walk away. FYI...I did both loans on stated income and think they were embellished on the apps to give me the funds. Hope this is enough info to help you help me. I want to do whatever is least damaging to my currently good credit but want to take the option that hurts my credit the least. Bankruptcy is NOT an option I hope! Thanks for any advice! Liz

You can file a deed-in-lieu, but that will not include the HELOC. A deed-in-lieu affects your credit score almost in the same way as a foreclosure does. It can lower your credit score by around 250 points. On top of that you need to pay taxes on the forgiven debt amount. However you can go for a short sale as it would be less damaging on your credit, reducing it by 75-100 points.

As far as the HELOC is concerned, you need to pay it off. Otherwise, the lender can charge off the credit. This doesn't mean the loan would be forgiven and moreover, its negative impact will stay on for almost 7 years and 180 days from the day of first non-payment. However, you can negotiate with the lender to remove the charrge off from your credit.

Thanks,

Jerry

I did a deed in Lieu about 2 years ago and now with this great market I would like to buy a house. My mortgae broker said there is a 4 year penalty time that i would not be able to buy anything and then someone else said no that it was changed to 2 years. Who is correct? Thank you!

Hi Lauraheisi,

I think the mortgage broker is right. The penalty time before you can buy a new home after doing a deed-in-lieu is 4 years, at least and it can extend upto 7 years. The penalty time is 3 years, in case you want to get an FHA insured mortgage.

Our house is appraised at $75k less than we paid 4 years ago. My hubby is finishing a 4 year residency. We have tried to sell the house for 2 years now with no luck. We are considering the deed-in-lieu option. We have been approved for a mortgage in the state my husband will be working in. We are moving in June. Other than rent this house, which we won't do since we are going to be living 1400 miles away, what can we do. Will the bank come after us since his salary will be higher? We also have a 80/15 loan. Can both banks come after us? Help!!!

Hi Wease,

A deed-in-lieu will affect your credit by almost 250 points and you might face difficulty while trying to get another loan in future. A short sale on the other hand may be less damaging, hurting your credit by 75-100 points. But you will have to pay the deficiency amount and the lender can place lien on your property and also garnish your salary. Thus I personally consider renting as the best option in this situation.

Thanks,

Jerry

we want to do a dil we are 2 months late on our mortgage and have had our house for sell now for 4 yrs ...we want to know how long it will take

Hi melissa,

A deed-in-lieu of foreclosure needs to be completed within a period of 90 days after it starts off. You can contact your lender and apply for a deed in lieu.

Thanks

We bought our home in 2005 and ended up having to do a deed in lieu process, which was was just completed in April of 2009. It was very simple...imagine that...the mortgage company wouldn't work with us on a modification or lowering our payment...but boy when they found out we were willing to deed it back to them...they were SOOOO helpful! Anyway...the home was just sold last week to another family...and I'm wondering if we will be responsible for paying a tax debt or if we will be able to get the tax relief thing. I'm fully expecting to receive a 1099 form, but can I get out of it?

I have a rental property and the balance is greater than the value. It has never been late 9 years. The property will soon become vacant and I am at my wits end. I am concerned about my credit. I want to do a DIL. I am very stressesd and upset about this situation. I fell like my entore life and thusly my credit will be destroyed. Will my creditors hut down my revolving credit? How much will my score drop. What reasons do they accept to get the DIL approved. I cant pay it any longer