Deed in Lieu of Foreclosure

A deed-in-lieu of foreclosure is when you give your home back to your lender, take your losses, and thereby prevent the foreclosure. The deed in lieu of foreclosure offers several advantages to both the borrower and the lender. The principal advantage to the borrower is that it immediately releases him/her from most or all of the personal indebtedness associated with the defaulted loan and prevents the foreclosure from marring their credit histories. A deed in lieu of foreclosure will benefit the lender by saving costs of a formal foreclosure proceeding and allowing them to resell the property and get a paying occupant so they can get back some of their original loan. A lender will most often pursue a deed in lieu for foreclosure when the borrower lacks any assets to make pursuing a deficiency judgment worthwhile.

Repayment Plan

A repayment plan is a workout option that looks at the amount past due and spreads the past due amount over a period of months. Generally, in a repayment plan the lender will require a one time lump sum amount to reduce the arrearage owed on the loan and place the borrower on a repayment plan. Other times, the lender will except a one time lump sum and re-amortize the remaining arrearage in the life of the loan. In these situations the borrower should be aware as the lender sometimes will set them up in a repayment plan that is doomed to fail from the start. Contact our law office and we will ensure that any repayment plan fits your financial needs.

Loan Modification

Loan modifications go a step further than repayment plans. Loan modifications are designed for customers that cannot afford repayment plans. In a modification, the lender actually adjusts the terms of the loan to make it affordable. It may lengthen the amortization schedule or lower the interest rate to cut the monthly payments, or roll the past due amount into the loan and re-amortize the new balance so the borrower can pay the additional debt back over time. Loan modifications are particularly beneficial for borrowers who have adjustable rate or interest only loans.

Contact the law offices of Ivan T. Lenoir II today to learn more about how we can assist you with your foreclosure.