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Deed in Lieu of Foreclosure

Boscoe
Established Contributor

Deed in Lieu of Foreclosure

Has anyone heard of this?
I got discharged from my bk in October 2007.  In order to get one of my discharged mortgages out of my life, I asked the bank to do a DIL.  They agreed finally, but I was to pay closing costs of $4k!
I don't think so!!!!   
 
I thought the DIL's were "sign the papers" and move on.  No cost to me.
 
Anyone else heard of this and what are your experiences?
Message 1 of 7
6 REPLIES 6
granny031350
Established Contributor

Re: Deed in Lieu of Foreclosure

hi, Boscoe.  Just wondering if you ever found out your information.  I never did a DIL so I have no idea about the costs. Smiley Sad  Hope you figured it out.  I wouldn't pay 4K to walk away though. 
Message 2 of 7
Boscoe
Established Contributor

Re: Deed in Lieu of Foreclosure

I said no to paying anything.....I am not sure what they will do next.
Message 3 of 7
kilogram
Established Member

Re: Deed in Lieu of Foreclosure

Do you have a first and a second? I do, and will be traveling down this road within the next couple of weeks. How does DIL work with two lenders when I owe more than the house is worth? The second lein holder stands to loose about $60k...
Message 4 of 7
BillsLemonade
New Member

Re: Deed in Lieu of Foreclosure

Boscoe,
 
I would see a CPA Tax Advisor who specializes in this. I believe this is considered forgiven debt to IRS and there are tax consequences to this just like in Foreclosure.
 
Bill
Message 5 of 7
Boscoe
Established Contributor

Re: Deed in Lieu of Foreclosure

Bill - when the bk is discharged, the debt is canceled, and there is no, repeat NO tax consequences of forgiven debt.
 
Regarding this DIL, I got them to change their mind and they did the DIL at no charge to me!  Closed on Feb 20th.   This one is done and gone!
Message 6 of 7
justmetanyac
Established Member

Re: Deed in Lieu of Foreclosure

When you first asked them about doing a deed in lieu, did they says anything about having to try to do a short sale first.  I wanted to do a deed in lieu but was told we had to try this first.  All of our bills are current right now but they won't stay that way if we don't get rid of the house.  We were told the house had to be on the market for, I think 60 days, before we could do a deed in lieu.  I don't believe our house will sell at all and we would like to just move forward with the DIL.  How did you convince them to let you do this?
Message 7 of 7
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