Posted on: 02nd Dec, 2010 01:05 pm
in a lieu of foreclosure bank sells property for say 250,000 appraisal is 538,000 debt is 581,000 does lender take appraisal price and deduct debt which shows a gain of 43,000 because 1099A #4 on instructions say in abandment or lieu of foreclosure take appraisal and put debt in #2 if so does lender have to give balance to borrower?
Hi kimberly,
If the lender receives a higher amount than the mortgage dues from the sale of the property, then he will have to return the excess amount to the borrower. The lender cannot keep the excess amount with himself.
If the lender receives a higher amount than the mortgage dues from the sale of the property, then he will have to return the excess amount to the borrower. The lender cannot keep the excess amount with himself.
If you actually net a profit from the sale of the home even if it is a deed in lieu the lender can give you the remaining difference, however, all fees and other outstanding balances will be deducted from the profit before the lender actually cuts you back a check. I would call your lender and ask them for the exact payoff so you know if you are getting any money back.