Posted on: 05th May, 2008 08:40 am
I read where if one does a short sale...the bank can sue for a judgement for the outstamding balance.
Then I read where if one does a Deed in Leiu of Forclosure, the bank WONT sue for judgement. WHY????????
Then I read where if one does a Deed in Leiu of Forclosure, the bank WONT sue for judgement. WHY????????
deed in lieu of foreclosure are usually only granted when the property has equity. if the bank believes they can get the house back and sell and make a little money or break even, then there is no reason to sue the homeowner. the reason the bank does not come after you for the difference, is because the deed in lieu paperwork states they will not seek any deficiency judgements against you if you deed them the house. it is less costly for the bank to get the house back and immediately get the tenant to vacate and sell asap. during a short sale, there is no equity. because there is no equity, the bank is going to lose money regardless, so they need some type of financial recourse. hope this helps.
Hi Gil,
Welcome to the forum.
Good info but don't you think deed in lieu is better for both the lender and the borrower because the borrower needs not to pay deficiency judgment and the lender can reduce the cost of repossession and save time in the process of deed in lieu?
BTW are you a mortgage professional or a lender? If so I think you can join this community and help people out with your sound knowledge and suggestions. Please have a look at http://www.mortgagefit.com/community/professionals.html
Hope you will enjoy participating in this forum :)
Best of luck,
Larry
Welcome to the forum.
Good info but don't you think deed in lieu is better for both the lender and the borrower because the borrower needs not to pay deficiency judgment and the lender can reduce the cost of repossession and save time in the process of deed in lieu?
BTW are you a mortgage professional or a lender? If so I think you can join this community and help people out with your sound knowledge and suggestions. Please have a look at http://www.mortgagefit.com/community/professionals.html
Hope you will enjoy participating in this forum :)
Best of luck,
Larry