Foreclosure is never a desired process not just because you would be losing your house but because it will leave behind a stain on your credit rating. This is definitely not good since it can stand in your way for other subsequent loans that you might be going for in near future.
A deed in lieu is one of the good options you have to avoid foreclosure. Here, you literally sign over your house to the lender as a way to fix issues caused by mortgage defaults.
The documents you sign for a deed in lieu
There are some documents you have to sign for the deed in lieu process. But before that, it would be good if you can have some guide from a loan modification company to ensure you are well covered in the process. loanmoddepot.com can help you in this regard, thus contact them for further assistance.
Now here are the documents you have to fill in:
- Warranty deed
- Agreement in lieu of foreclosure
- Grant deed
Here, both you and your lender will sign an agreement on the terms and conditions of the deed. This will give the ownership of the home to the lender. The lender will sign to ensure that you have paid and your debts are no more valid. You would be given a copy of it. Ensure you understand how all this goes or better still let a loan modification lawyer guide you in whichever document you sign. You can reach out to loanmoddepot.com as well for this purpose.
The escrow company
The escrow company is where both of the two documents go e.g. the marked one as ‘paid’ and the deed in lieu document. They keep the record and send you a confirmation that you are no longer owing your lender or the mortgage company.