Posted on: 05th Jul, 2007 03:17 pm
If you proceed with a DIL of foreclosure and your balance owed is say $400,000, but the mortgage company sells your property for $350,000. Are you liable for the difference?
If the lender accepts a dil then he cannot claim the balance through what is called as deficiency judgment. If it had been a foreclosure then it would have been possible for the lender to claim deficiency judgment.
Miller
Miller
"If you proceed with a DIL of foreclosure and your balance owed is say $400,000, but the mortgage company sells your property for $350,000. Are you liable for the difference?"
zulubenz, you should know that deed in lieu will bring your credit score down and that may be a cause for concern in future when you try to borrow again.
Have you explored all other options apart from deed in lieu, such as forbearance, loan modification... to bring the payments current? Did you explore the market in your area to know what the houses are selling for and present value of your house?
zulubenz, you should know that deed in lieu will bring your credit score down and that may be a cause for concern in future when you try to borrow again.
Have you explored all other options apart from deed in lieu, such as forbearance, loan modification... to bring the payments current? Did you explore the market in your area to know what the houses are selling for and present value of your house?
I have not missed a payment and I can afford my loan. My credit is current at at Outstanding rate, but I want to be able to afford other things outside of my loan. I can't do anything except pay my mortgage. I am locked into this loan for another year, it is a fixed rate with a pre-payment penalty. From the balance on the loan in another year I still will owe more than its worth. So why not get out now and save that year's worth of money instead of ending up in the same place next year with $30,000 dollars less?
hi zulubenz,
welcome to mortgagefit discussion board.
within a year it might happen that you locate a better job & able to afford other expenses apart from mortgage payments, or value of the house increase which will allow you to sell it and don't require requesting for a dil. it might also be possible that you are able to refinance to get a lower rate after one year.
your credit is quite good & will take a big drop after a dil. so you need to think more about the other options right now before going for a dil. and as you are current right now the lender won't listen to your request for accepting the house by way of a dil. after the loan is in default and the lender is convinced that your have financial problems because of which you cannot continue the payments then only he will agree to accept a dil request. but right now the loan is current.
thanks
blue
welcome to mortgagefit discussion board.
within a year it might happen that you locate a better job & able to afford other expenses apart from mortgage payments, or value of the house increase which will allow you to sell it and don't require requesting for a dil. it might also be possible that you are able to refinance to get a lower rate after one year.
your credit is quite good & will take a big drop after a dil. so you need to think more about the other options right now before going for a dil. and as you are current right now the lender won't listen to your request for accepting the house by way of a dil. after the loan is in default and the lender is convinced that your have financial problems because of which you cannot continue the payments then only he will agree to accept a dil request. but right now the loan is current.
thanks
blue
I did'nt know that you had to be behind in you payment before the mortgage company would consider a DIL. Thank you for that information. I think it might be a good idea to hang in there until next year and re-finance my place and maybe get a fixed rate.
"My credit is current at at Outstanding rate, but I want to be able to afford other things outside of my loan."
If you do some planning then I am sure you'd be able to spend some monie on other things apart from the mortgage payments. How muc is your income and mortgage payment? How you will owe more than house will be worth after 1 yr? Are the house prices going down real fast?
If you do some planning then I am sure you'd be able to spend some monie on other things apart from the mortgage payments. How muc is your income and mortgage payment? How you will owe more than house will be worth after 1 yr? Are the house prices going down real fast?
ask me if you have any other questions, I'll be glad to help you out if I can :D
Yes that's true Zulubenz. Your mortgage company will not pay attention to dil request if the mortgage is still current.
After defaults when you request for a possibility of your house be accepted by them through a dil they will check your financial position. It will be checked to make sure that there is true financial crisis which lead you into a position where you're not able to continue the mortgage.
They will also require you to list the house for sale for few months to judge the market and whether it can get sold before accepting the dil request.
As Blue mentioned you are still able to make the payments and the rate is not going to adjust for a year (I assume it a arm with rate adjustment to occur in a years time), so continue the payments and go through the market to know if refinance into a frm for a lower rate would be possible or not.
David
After defaults when you request for a possibility of your house be accepted by them through a dil they will check your financial position. It will be checked to make sure that there is true financial crisis which lead you into a position where you're not able to continue the mortgage.
They will also require you to list the house for sale for few months to judge the market and whether it can get sold before accepting the dil request.
As Blue mentioned you are still able to make the payments and the rate is not going to adjust for a year (I assume it a arm with rate adjustment to occur in a years time), so continue the payments and go through the market to know if refinance into a frm for a lower rate would be possible or not.
David
"I did'nt know that you had to be behind in you payment before the mortgage company would consider a DIL. Thank you for that information. I think it might be a good idea to hang in there until next year and re-finance my place and maybe get a fixed rate."
Deed in lieu is used in a situation where you are not able to make the payments and somehow want to save yourself from being foreclosed. It is one of the last resorts before the house goes into foreclosure. But right now you have many options left before you. And there is one more year to decide the way you should go...refinance, sell the house, continue the same mortgage if income increases...in one year equity can also build up and make it easier for you refinance...
Deed in lieu is used in a situation where you are not able to make the payments and somehow want to save yourself from being foreclosed. It is one of the last resorts before the house goes into foreclosure. But right now you have many options left before you. And there is one more year to decide the way you should go...refinance, sell the house, continue the same mortgage if income increases...in one year equity can also build up and make it easier for you refinance...
hi zulubenz,
don't go for a deed in lieu of foreclosure right now as there is one more year for you to repay the loan. and when you can afford it then continue making your payments. after one year, depending on the situation you can refinance the loan to get a lower rate of interest.
don't go for a deed in lieu of foreclosure right now as there is one more year for you to repay the loan. and when you can afford it then continue making your payments. after one year, depending on the situation you can refinance the loan to get a lower rate of interest.
Hello Zulubenz,
Deed-in-lieu (DIL) basically is a process in which when the borrower fails to complete the loan requirement, he then gives his property to the lender. As you are still having one more year to go, I think that you should start looking for options to payoff your debts.
Deed-in-lieu (DIL) basically is a process in which when the borrower fails to complete the loan requirement, he then gives his property to the lender. As you are still having one more year to go, I think that you should start looking for options to payoff your debts.
Hi Zulubenz,
Welcome to the forums.
It's good to hear that you have not a single missed payment. And, if your credit is outstanding then that's even better.
If you are locked into the loan for another year, I mean if there's just one more year left to pay off the loan, then you can just carry on with it as otherwise if you will have to pay the penalty. Just for a year why do you want to switch over to a new loan and then again continue paying for a mortgage for a certain period of time? I understand that you're unable to do a number of things as you've mentioned but here's where I would advice you to decide upon your priority – whether you wish to get debt free earlier or carry on with the same loan just for a year.
Good luck :)
Welcome to the forums.
It's good to hear that you have not a single missed payment. And, if your credit is outstanding then that's even better.
If you are locked into the loan for another year, I mean if there's just one more year left to pay off the loan, then you can just carry on with it as otherwise if you will have to pay the penalty. Just for a year why do you want to switch over to a new loan and then again continue paying for a mortgage for a certain period of time? I understand that you're unable to do a number of things as you've mentioned but here's where I would advice you to decide upon your priority – whether you wish to get debt free earlier or carry on with the same loan just for a year.
Good luck :)