Deed in Lieu

9 Replies

Would and Investor (institutional or otherwise) turn down a HAFA deed in lieu?

All comments are welcome.

Thanks!

Originally posted by @Ray Mulli:

Would and Investor (institutional or otherwise) turn down a HAFA deed in lieu?

All comments are welcome.

Thanks!

 ***correction***

Would AN investor turn down a HAFA deed in lieu?

Are you asking about the Investor, as the mortgagee, or the mortgagor.  If you mean mortgagee, the investor/owner of the loan, then yes there could be a number of reasons.  The borrower/mortgagor has other assets or money available to pay the loan, the mortgagee may not want to waive the deficiency.  What's the goal here?

Thanks!

Yes...I'm asking about the investor as mortgagee.

I thought with HAFA, investors are more than happy to move the non performing asset to a performing one.....not so?

First, why do you think it's HAFA? The majority of the investors are not HAFA participants. Taking a DIL doesn't make a loan performing, in means owning another REO that they don't want. They'd usually rather have you do a short sale, at something resembling current FMV.

Originally posted by @Ray Mulli :

Thanks!

Yes...I'm asking about the investor as mortgagee.

I thought with HAFA, investors are more than happy to move the non performing asset to a performing one.....not so?

I wouldn't use the term "more than happy" to describe any lender/investor dealing with a non performing asset.  

There are also title concerns.  Lender's often reject DIL offers where there are liens and judgments that would be eliminated in foreclosure.

Like Wayne asked......what's your goal?

Ah....the goal....to walk away from an underwater and expensive mortgage.

The mortgage holder generally requires you list your home on the market as a short sale before they will consider a deed in lieu.  If your Agent is unsuccessful at getting a short sale approval, then they will generally consider you for a deed in lieu.   If it is a HAFA, you will likely be offered relocation assistance if it is an owner occupied residence to complete a short sale.   

Thanks Kim. Seems like you know quite a bit about this....

Here is a related question, an reason an investor would turn down a HAFA DIL?

Originally posted by @Ray Mulli :

Thanks Kim. Seems like you know quite a bit about this....

Here is a related question, an reason an investor would turn down a HAFA DIL?

Still curious why you are concerned about the loan "investor". Lot of lenders/investors are not participating in HAFA. Do you know for certain that your lender is?

Is this a primary residence or an investment property?  

Again, DILs are rejected when the title/debt picture doesn't meet lender requirements. In other words, they won't usually accept the DIL unless the title is squeaky clean. Any other liens or judgments? HOA? IRS? State taxes? Abstract judgments?

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