Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 16%
$32.50 /mo
$390 billed annualy
MONTHLY
$39 /mo
billed monthly
7 day free trial. Cancel anytime
Rehabbing & House Flipping
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 7 years ago on . Most recent reply

Account Closed
  • Real Estate Agent
  • Washington, DC
34
Votes |
126
Posts

Deed Of Lieu Repercussion (Hard Money)

Account Closed
  • Real Estate Agent
  • Washington, DC
Posted

Hey BP,

If I give my property back to my hard money lender in deed of lieu and they take the property back and rehab it, will this affect my credit score and stop me from getting a bank loan in the future? I tried to flip a home with a hard money lender before purchasing my primary residence and ran into issues with a bad contractor. My credit score is great and I don't want to ruin it.

Most Popular Reply

User Stats

43,634
Posts
64,450
Votes
Jay Hinrichs
#1 All Forums Contributor
  • Lender
  • Lake Oswego OR Summerlin, NV
64,450
Votes |
43,634
Posts
Jay Hinrichs
#1 All Forums Contributor
  • Lender
  • Lake Oswego OR Summerlin, NV
Replied

Extremely rare that a HML reports to fico.. here is why.. they have to report ALL their loans to fico or NONE.. I went through this when I was running my shop.. Ergo its highly doubtful they report..

what they can do though is issue you a 1099C which will be ordinary income to you.. and create a mess with the IRS.

they could sue you for a judgment.

If they go the DIL route make sure you have an attorney negotiate out the fact that no deficieancy can be done and that they will not issue the 1099C against you.

business profile image
JLH Capital Partners

Loading replies...