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EROXXZY4
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Post subject: Help! |
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My parents bought a home in P.A. 3 years ago. Commuting back and forth to N.J. 5 days a week and spending more than $700 in gas a month, not including other bills. They counted up all their bills and their monthly bills exceeded their income by 3 times. We were advised by a realtor and a banker to go through with Foreclosure. We've since moved out of the home and live in N.J.. We have a FHA loan on the home we left. Today I was told by our lender's Home Owners Assistance to send a letter for Deed in Lieu of Foreclosure. What should I put in the letter? What are the laws in P.A. when it comes to Deed In Lieu of Foreclosure? Will my parents still be held liable for the mortgage?? PLEASE HELP!!! YOU CAN EMAIL ME AT "EROXXZY4@HOTMAIL.COM"
[Email address deactivated as per forum rules. Thanks.] |
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Jon
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Post subject: Deed in Lieu |
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| My question is about the deed in lieu. I moved out of my property back in February of 2008 because my bank said that they were going to forclose on us. We found an investment company & realtor to help list the property and stop the foreclosure. It has been on the market since Feb, 2008 under a short sale & still no offer. I was told by the investor that I should consider doing the deed in lieu to help us get out of the mortgage. We have a 1st & 2nd mortgage 80/20 under the same lender. The lender has already approved the 1st mortgage into the DIL, we are just waiting on the 2nd mortgage right now. If they approve the DIL on the 2nd mortgage, can they come after us for any deficiencies after the deal is done? We took the loan out to purchase the property only & have never refinanced or did any kind of equity line of credit. I was told by some one that if that is the case, they can't come after us for any differences. Is that true? I feel that we have been communicating with the lender and trying to work out any way to save our home, but it seems useless at this stage. We have no more cash to spare and feel that this might be are last resort. Please let us know if this is the best way to go about doing this. |
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jameshogg
Joined: 20 Dec 2005
Posts: 10148
Location: Nevada
941.94 Dollars($)
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Post subject: reply to EROXXZY |
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Hi EROXXZY,
Welcome to forums.
I think your parents are being asked to send a hardship letter wherein they should state why they cannot pay off the loan and what alternative option they would like to go for so that the lender can recover the money invested. Know how to write a sample hardship letter for your reference.
| Quote: | | What are the laws in P.A. when it comes to Deed In Lieu of Foreclosure? |
If it's a deed in lieu, then your parents shouldn't be personally liable for the any amount or deficiency that the lender may not be able to recoup by selling off the home after it is deeded back to the lender.
Although PA is a deficiency judgment state, but as your parents are going for a deed in lieu, they don't need to pay any deficiency. But there can be tax considerations involved. Know more on deed in lieu and tax considerations .
Thanks |
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helping_user
Joined: 31 Mar 2006
Posts: 806
Location: Hawaii
158.49 Dollars($)
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Post subject: RE: deed in lieu on 2 loans |
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Welcome Jon.
Deed in lieu of foreclosure is a process wherein you give back property to your lender when you fail to pay off the mortgage debt. Since the first lender has already accepted a deed in lieu, he'd be taking away the property and selling it off. So, there cannot be a separate deed in lieu. But if the housing market is good enough in our area, then the sale proceeds obtained after the deed in lieu on the first can be shared by both the lenders provided they agree to do so.
Usually lenders don't ask for deficiency payment in deed in lieu. So, hopefully they won't come after you once they sell the property.
Thanks. |
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eroxxzy4
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Post subject: |
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| Thank you all =) I'll be crossing my fingers that they accept the deed in lieu and won't ask for deficiency payments. Wish me luck!!! |
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randoon
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Post subject: IRS lien |
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| my property has a 150k mortgage and an IRS lien of 65k, but property value is 200k. if I do a deed in lieu will I still owe anything? |
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randoon
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Post subject: IRS lien |
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| See above post: I have missed 3 payments, it is a rental (currently rented) and I do not want to keep the home (I want it gone so the IRS lien will get paid in full thus the lien will no longer be on a vacant lot behind the home, a separate parcel). The lien is not against me, its against the prior owner (both parcels), and was their when I did a owner deed purchase. When I refi'd with this lender, Title was a lenders owner policy and they missed the lien, so it appears lender is protected. So, I am simply trying to get rid of property so that IRS lien eventually gets paid. Its in Washington State. Credit hit is not a problem. What should I do? |
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Caron
Moderator
Joined: 19 Jul 2005
Posts: 1519
Location: florida
281.04 Dollars($)
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All the best eroxxzy. Let's hope that the deed in lieu is accepted.
To randoon:
I think the IRS lie will have priority over the mortgage lien. as such, the IRS lien should be paid off first and then the remaining amount should go towards the mortgage. Usually in case of deed in lieu, lenders don't ask for the payment of deficiency.
| Quote: | | The lien is not against me, its against the prior owner (both parcels), and was their when I did a owner deed purchase. |
Even though the IRS lien is not against you, it should be paid off because you have purchased the property.
Good luck
_________________
Mortgage Shopping made easy with booklet |
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stuck
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Post subject: deed in lieu question |
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| We got caught in the real estate downturn when buying a house before the other one sold. We now have two mortgages with the same mortgage company. We are not delinquent on either loan but are using up our savings quickly. Both houses are now on the market, but without immediate prospects of selling. If we do a deed in lieu of foreclosure on one house, can the mortgage company put any type of additional lien on the house we keep as long as we continue to be current with that mortgage? Both homes are in North Carolina. |
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sara
Moderator
Joined: 05 Jul 2006
Posts: 2642
Location: New Brunswick, New Jersey
488.01 Dollars($)
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Post subject: RE: |
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Hi stuck,
Welcome to the forums.
I guess the lender won't place a line on the other property because of deed in lieu on one house. This is because deed in lieu waives the lender's right to collect deficiency.
Take care
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Find me at FB: http://www.facebook.com/people/Sara-Jones/100002976822020 |
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Melissa
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| Can a deed in Lieu still apply if i have a jumbo load split into 2 mortgages.. an 80% ande 15% loan? and could it still apply if i have it with two different lenders? |
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sara
Moderator
Joined: 05 Jul 2006
Posts: 2642
Location: New Brunswick, New Jersey
488.01 Dollars($)
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gr
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Post subject: deed in lieu |
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| my dad help my uncle buy a house cause he was in bankrupt ... so the house is in his name.. now my uncle can;t afford the house n is two payments behind and now my dad's credit is in danger n also we might end in bankruptcy.... so we are thinking in the dil.... but i dont know how it works n how it might affecct us... |
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Samantha
Community Mentor
Joined: 16 Sep 2005
Posts: 1609
Location: MASSACHUSETTS
150.97 Dollars($)
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stkbtwnarcknhrdplac
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Post subject: Short sale or Deed in Lieu |
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| Is there a difference? What is it? Is one solution better than the other? |
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