Deeds-in-lieu is a foreclosure alternative that is gaining popularity with the lenders reports the Los Angeles Times on June 27, 2010. The key seems to be that “not only is it cheaper for lenders to do deeds-in-lieu to gain control of those properties, but with the current mortgage rates below 5%, they’re likely to be able to resell the properties faster and on potentially more favorable terms in the summer and fall.”
A deed-in-lieu takes place when the mortgagor transfers all interest in the real property to satisfy the loan instrument and avoid the foreclosure proceeding.
The homeowner sees this as “’a very expeditious way to move on’ for underwater borrowers who are facing potential foreclosure.” They are tired of dealing with low ball offers, the stress of working on a short sale and the real estate agents and embarrassment of facing their neighbors of the current situation.
A downside of the limitations of a deed-in-lieu is it does not work for all – “if you have equity in the property, you’ll probably want to pursue a loan modification first, rather than hand over your equity stake to the lender.”
If you are interested in leasing, purchasing a property or selling a property in Malibu, Pacific Palisades, Calabasas or the surrounding Beverly Hills/southern California area then please contact Judy Kunisaki for professional real estate advice in the Westside Los Angeles area, on 310-317-8396 her online contact form on her website.
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Judy Kunisaki – CA DRE license 00963582
