However, many banks and financial institutions will require that alternate means of foreclosure avoidance be explored before accepting a deed in lieu of foreclosure. For example, many will want to attempt a short sale before moving forward, as that arrangement allows the bank to collect a good portion of the property’s value upfront versus simply releasing the borrower from their obligations.
Many institutions in Florida will also seek to reserve the right to pursue deficiency judgment as part of the deed in lieu agreement. This provision can be dangerous for borrowers, as it allows your lender to seek compensation for the remaining balance, or deficiency, on your mortgage. This dampens or outright defeats the purpose of pursuing a deed in lieu in the first place for many borrowers, and the practice can wreak havoc on the rest of your life. Should a borrower be granted a deficiency judgment by a court, they will be permitted to garnish your wages or even levy your bank accounts to collect what is owed. Experienced Tampa deed in lieu of foreclosure lawyers can help negotiate around both of these common requirements and make sure there are no surprises in the language of the agreement.
Once the application has been approved and an agreement drafted to the parties’ mutual satisfaction, the borrower will sign the “grant deed in lieu of foreclosure,” which officially transfers ownership to the lending institution. The borrower will also sign what is called an “estoppel affidavit,” a legal document validating that the borrower entered into and will honor the terms of the agreement voluntarily. At this point, the lending institution assumes full control of the property, and the previous owner will amicably vacate. Both parties avoid having to experience a grueling foreclosure process, and money is saved on both sides.
Get Assistance with Your Deed in Lieu of Foreclosure
Whether you are a borrower or a lender, our legal team at Cremeens Law Group PLLC can assist you in each step of a deed in lieu of foreclosure negotiation. For borrowers, we can assist in preparing your application, drafting your affidavit of hardship, and fiercely negotiating with your lending institution. For lenders, we can review submitted applications, evaluate possible alternatives, and negotiate terms that are both compassionate to the homeowner while preserving the interests of your institution. Either way, our Tampa deed in lieu of foreclosure attorneys are committed to facilitating successful deed in lieu of foreclosure agreements and helping both sides achieve favorable outcomes.
Do not attempt to negotiate a deed in lieu of foreclosure agreement on your own! Get the help of our team by calling (813) 683-8688 or contacting us online. We offer free initial consultations and services in both English and Spanish.