Options in Letting the House Go

One of the most common reasons for wanting to give up a house and avoiding a foreclosure is that the person wants “to avoid a foreclosure showing up on their credit report.” It should be noted that while the options listed in the posts below might avoid a foreclosure, they likely contain their own negative consequences that could potentially show up on a credit report. How much a credit score will suffer with a foreclosure on a credit report as opposed to a short sale or a deed in lieu is beyond the scope of this website, but it should be noted that any such difference may perhaps be somewhat negligible.

Deed in Lieu of Foreclosure

A deed in lieu of foreclosure (usually referred to simply as a “deed in lieu”) is a process by which the debtor signs a deed transferring all of his/her rights, title, and interest in the property to the lender in satisfaction of the debt and as a substitute for foreclosing on the property.  The rationale […]

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Short Sales

In a typical mortgage transaction, a lender will not release its lien on a property until it has been paid in full.  This means that you are unable to sell your home unless you sell it for at least the amount still owing to the mortgage company.   A short sale is a process by […]

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