deed in lieu of foreclosure

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deed in lieu of foreclosure

An instrument transferring title to real property to a mortgage lender without the necessity of going through the foreclosure process. Called the deed in lieu (pronounced “loo”) for short, the procedure is attractive to lenders because of the speed, lack of any defenses, and removal of anxiety about last-minute borrower bankruptcy. It is attractive to borrowers because there is no foreclosure to appear on the credit records.There is some risk to the lender if there are intervening liens,because a deed in lieu transfers title to property subject to the effect of any junior liens.Usually a foreclosure destroys other liens,if they were recorded after the mortgage or deed of trust.

Deed in Lieu of Foreclosure

Deeding the property over to the lender as an alternative to having the lender foreclose on the property.

See Payment Problems/Position of the Lender/Permanent Problem.

References in periodicals archive ?
Many loans are tied up in securities, and banks now with adequate reserves are arranging deed-in-lieu and short sale agreements themselves.
PRO HAFA automates every aspect of a short sale or deed-in-lieu transaction based upon the guidelines set forth by the U.
Also, deed-in-lieu transactions fell off sharply from a year ago.
Delshah asserts in a letter filed with the court that Asher Zamir, principal of Zamir Equities, agreed to a deed-in-lieu only in exchange for removing his personal financial guarantee.
0m in reduction of the loan, turned the property over to the lender pursuant to a deed-in-lieu transaction, and was relieved of the USD26.
In response to the unprecedented interest in this loss mitigation method, the West Valley, Utah-based company is offering a pre-foreclosure short sale and deed-in-lieu program.
However, lenders in other states should remain cautious and approach a deed-in-lieu transaction in the same manner as if it were a real estate purchase outside of a loan context.
Other recent deals include the sale of 17 East 12th Street on behalf of The Brauser Group for a record $1,034 per buildable square foot; a 28,500-square-foot lease with technology firm IDEO at 408 Broadway, a vacant building brought to full occupancy for Urban American Land after arranging the purchase of its defaulted mortgage and deed-in-lieu of foreclosure in 2011.
The 1925 three-story Art Deco building is located one block south of Lincoln Road's pedestrian mall and had been in the hands of private lender Pinetree Partners since March 2009, when it was acquired in a deed-in-lieu of foreclosure from developer Neptune Premier Holdings.
The automated portfolio review tool, which provides risk management from early risk detection through loss mitigation by automating the review, analysis and management of any size portfolio, now includes short sale, foreclosure and deed-in-lieu analysis.
The deed-in-lieu activity showed a decline of 20 percent in November compared with October.
If history repeats itself, we will see a surge in the numbers over the next few months as lenders foreclose on delinquent loans where neither the existing loan modification programs or the new short sale and deed-in-lieu of foreclosure alternatives works.