Deed in Lieu Marked "Disputed but Resolved" on Credit Report?

[Anonymous]

My attorney is negotiating with my lender's attorney regarding an investment condo I own that is in litigation. The lender's attorney said they will entertain either a DIL or a short sale but that the DIL carries no 1099C. My accountant tells me not to worry about the 1099C as it is business but I need to know...if I took the DIL and they mark it as above, will my credit be tarnished. There are no late payments as Im up to date (performing loan). I just am under the impression that a DIL, no matter how it is reported is still a foreclosure as such.

The lenders attorney said they would probably put Disputed but Resolved???

Please, I need some advice ASAP as I must let my lawyer know what I decide. Thanks.

[Anonymous]

I would post this on the mortgage threads for better response.

Normally a DIL provides that the lender is accepting the property as satisfaction to the loan.  However, if the mortgage was late prior to the DIL, you may have those derogs reported.

A DIL is not a settlement for less than owed, since the property was not shorted nor foreclosed for an amount less than owed.  The lender accepted the deed as payment.

But, the mortgage guys probably can give better input.  I suggest the MODS move you there.

[Anonymous]

Thanks, will do!

[Scamp]

Locking this duplicate thread and asking anyone who'd like to respond to OP to do so on his new thread over in Mortgages:

http://ficoforums.myfico.com/fico/board/message?board.id=loans&message.id=50962#M50962