Facing a foreclosure is something nobody wants. You are still liable for the mortgage in the meantime. The process is long and emotionally traumatizing. To be frank, a foreclosure is also just plain embarrassing. It gets published. Anyone has access to it. Not that any of that should matter, but when it comes down to it, for hard-working people, it does.
There could be a possible solution to the problem: a deed in lieu of foreclosure. You don't get to keep you home, but you do get to escape the headaches of a foreclosure. You may never have heard of this, so we are here to tell you what it is and how it could benefit you if you are at risk of foreclosure in New York.
What is a deed in lieu of foreclosure?
A deed in lieu of foreclosure is pretty much a conveyance by the owner of the mortgaged property to the mortgagee. This conveyance represents full satisfaction of the amount due.
But the title must also be clear of:
- liens; and
In order to take advantage of a deed in lieu of foreclosure, your servicer must approve it. Many services may require you to make a good faith effort to sell the property first. If no one buys within a certain time period, then you may have permission to go ahead with a deed-in-lieu.
How can a deed in lieu of foreclosure benefit you in New York?
There are advantages to a deed in lieu of foreclosure. For the homeowner specifically, it decreases the costs and emotional pain that a foreclosure would impose.
In New York City, many mortgage services offer what's known as a "cash for keys" program. The program provides homeowners with cash for relocation costs. To receive it, though, you usually have to vacate the premises on an agreed-upon date and leave it in a good, clean condition. But the cash relocation assistance is a benefit if you are worried about the expense of the move.
Who can you talk to so you know this is the right method for you?
Foreclosure is a serious matter. You shouldn't ignore it. And deeds-in-lieu are not always an option. Plus, you may have some rights to stay in the house or to fight the foreclosure – but of course, that could be emotionally exhausting as well as time-consuming and expensive. It doesn't hurt to talk to a resourceful and thoughtful foreclosure defense attorney in New York first before you make any decisions you may regret later.
It's always best to know what all your options are concerning foreclosure so you can make an informed decision. And then, once that decision is made, you can move forward with confidence.