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 states rely (at least in part) on the intention of the parties; either express or implied, to determine whether a merger occurred as the result of a deed-in-lieu transaction.
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.
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.
Equator's HAFA solution will offer a specifically designed best-practice workflow that enables Lenders and Servicers to complete Short Sale and Deed-In-Lieu dispositions, satisfying homeowners' burdensome loan obligations.
In the case of foreclosures or deeds-in-lieu of foreclosure, such liens must be cleared no later than 3o days after the fore-closure sale or deed-in-lieu acceptance.
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.
Deed-in-lieu actions also have been increasing, OCC reported.
In addition, he represents various financial institutions in connection with restructurings of distressed assets including workouts, forbearance agreements, notes sales, deed-in-lieu of foreclosure agreements, and litigation related to foreclosures of real property.
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.
LTC stated that it is working with Minnesota counsel to perfect a deed-in-lieu and that the Company has been contacted by at least one other party interested in the property.