Talk:Deed in lieu of foreclosure
![]() | This article is rated Start-class on Wikipedia's content assessment scale. It is of interest to the following WikiProjects: | ||||||||||
|
not very knowledgeable about real estate, so I don't know what else there is to know that this article may be lacking, but it seems to me quite complete and well-written. I nominate it for de-stubification, but I'd like that to be done by someone who knows enough about real estate to judge the completeness of this article. Alexlockhart 00:09, 17 December 2005 (UTC)
- Article seems complete to me. De-"stubified". Davemcarlson 20:30, 11 June 2006 (UTC)
total consideration
[edit]"The settlement agreement must have total consideration that is at least equal to the fair market value of the property being conveyed. Generally, the lender will not proceed with a deed in lieu of foreclosure if the current fair market value of the property exceeds the outstanding indebtedness of the borrower."
The lender can't choose to take less than the loan amount? -Gbleem 04:08, 11 September 2006 (UTC)
"Generally, the lender will not proceed with a deed in lieu of foreclosure if the current fair market value of the property exceeds the outstanding indebtedness of the borrower."
I dont understand the above statement, it seems to be opposite to intuition and against the lender's (bank) interest. Say the outstanding amount owed by the debtor is $100. the fair value of the house is $150. it would seem good business for the bank to accept the deed to the house which is worth $150 in exchange for writing off $100 of the debt. 203.116.13.34 06:35, 10 April 2007 (UTC)moosekaka
- What they're saying is, the bank will, in situations where the property owner has equity (i.e. the market value is greater than the amount owed), choose not to accept a deed in lieu and instead request or require the owner to proceed with a market sale. This way, the bank avoids any accusations of impropriety because accepting the deed in lieu without getting the owner to at least attempt a market sale could be construed as taking advantage of an uninformed or distressed mortgagor. Accepting a deed in lieu when the loan balance exceeds market value allows the bank to write off the remainder of the loan (which they keep reserves to do), and is cost effective because it avoids a foreclosure and its associated costs. A foreclosure may cost the bank in the tens of thousands of dollars, especially after legal fees, costs of making the property "ready" for resale, and so on. Wyv 02:57, 10 May 2007 (UTC)
What are the tax consequences? —Preceding unsigned comment added by 12.45.221.194 (talk) 18:10, 9 March 2010 (UTC)
Forgiveness of mortgage debt?
[edit]In a deed-in-lieu agreement, when the debtor deeds the property to the lender and there is no foreclosure, must the lender forgive (cancel) the mortgage debt, or does the debtor still owe the debt to the lender?