Posted on: 09th Jan, 2009 01:36 pm
i see a lot of people suggesting that banks accept the deed in lieu of foreclosure. why would the bank do that and foregoe the right to collect the deficiency, if any, on a property that comps right at the oustanding mortgage amount? i'd like to think my bank would do that, but that seems like a lot of fairy dust and magic beans to me - much like the stuff the mortgage banker used to determine i was qualified to purchase a second home before my first one was sold. hmmm. maybe it will work.
matt, the main reason for acceptance of a deed in lieu is to avoid the costs and the time required to foreclose. it simply shortens and cheapens the process of the lender taking back the property. the costs involved in foreclosing are prohibitively high.