Deed in Lieu/Consent Judgment
If you can no longer make your mortgage payments, you may believe foreclosure is your only option. There is, however, an alternative to foreclosure that is commonly referred to as a deed in lieu of foreclosure or consent judgment.
A deed in lieu of foreclosure allows you to negotiate certain legal protections for yourself that are not available in a foreclosure action. In addition, by avoiding a judgment of foreclosure, less damage is done to your credit. In certain cases, it is even possible to obtain cash incentives for choosing a deed in lieu of foreclosure.
Sometimes for two main reasons pertaining to title issues and bankruptcy, a lender will want to do a deed in lieu but will instead need a judgment. In this instance, the parties can agree to a judgment but also agree that no money will be due from the defendant and, often times this will include cash incentive and ample time to find new housing.
In order to best take advantage of the benefits provided by a deed in lieu of foreclosure or consent judgment, you should speak with an experienced Florida foreclosure defense lawyer.
At the Law Offices of Evan M. Rosen, we have successfully helped clients to negotiate advantageous deed-in-lieu or consent judgment arrangements with their lenders. A deed in lieu or consent judgment are just two of several options that we can help you pursue as part of a strategy to resolve your mortgage problems. In every case, we make a commitment to providing you with legal advice on all of your options and to fighting vigorously for you. Putting customer service first, we will listen to you, work with you and help you to get the best results possible.
You are welcome to read more about deeds in lieu below, or you can contact us now for a FREE CONSULTATION by calling 754-400-5150 or by filling out our online form.
What is a Deed in Lieu of Foreclosure?
A deed in lieu of foreclosure is an arrangement made with your mortgage lender where you agree to turn over the deed to your property and, in exchange, the bank agrees not to pursue a foreclosure action against you. Essentially, this means you voluntarily give the property back to the lender. The bank will then report the mortgage debt as satisfied, meaning that you are no longer under any legal obligation to pay. Under Florida law, satisfaction of the mortgage is required within 60 days.
A deed in lieu of foreclosure may be available by agreement with your lender, provided you do not have outstanding tax liens or second liens on your property, such as liens for unpaid homeowners’ association fees. Liens are claims on the property, and since you must turn over the deed to your lender in a deed in lieu of foreclosure, no one else can have a claim on the property except the bank.
If there are outstanding liens on the property, a similar alternative to foreclosure referred to as a consent judgment may be pursued. A consent judgment means you do not fight the foreclosure but instead you agree that the court should enter a judgment of foreclosure against you. A consent judgment speeds up the foreclosure process considerably and is much less costly and complicated for the lender. While a consent judgment does more damage to your credit than a deed in lieu of foreclosure agreement, it can be structured to provide all the other same benefits of a deed in lieu, such as waiver of deficiency and even a cash buyout component in which the lender gives you cash to consummate the transaction.
Advantages of a Deed in Lieu of Foreclosure
When choosing a deed in lieu of foreclosure, the most obvious advantage is that you avoid a judgment of foreclosure on your public record. A judgment of foreclosure can remain on your credit report for seven years, making it difficult for you to get credit and causing you to be disqualified for certain careers or positions for which a financial background check is performed. A judgment also stays on the official public records forever. When you turn over your deed, no judgment is entered against you.
Other advantages are also available as a result of a deed in lieu of foreclosure agreement, especially if you have an experienced Florida foreclosure defense lawyer representing your interests. For instance, as part of your deed in lieu agreement, your foreclosure defense attorney should negotiate a waiver of deficiency.
Because Florida is a “recourse state,” lenders have further recourse after a foreclosure action. If they do not generate enough funds from a foreclosure sale to pay for the total you owe on the property, as well as for their costs in foreclosing, they can obtain a deficiency judgment against you for the remaining balance owed. These deficiency judgments can be for very substantial sums of money. They can further destroy your credit, act as a lien against you for as long as 20 years and can even result in your wages being garnished to pay the judgment. With a deed in lieu of foreclosure arrangement, the Law Offices of Evan M. Rosen will negotiate with the lender and make sure the lender formally gives up the right to pursue a deficiency judgment against you.
Cash for Keys
It is also possible for homeowners to obtain cash incentives for giving up the deed to their home instead of forcing the lender to foreclose. The government encourages such incentives through a program called Home Affordable Foreclosure Alternatives (HAFA), which provides lender incentives as well as cash to homeowners to help cover moving costs and other expenses. Programs provided through the government and from private lenders that provide cash incentives to homeowners for deed in lieu arrangements are commonly referred to as “cash for keys programs.”
At the Law Offices of Evan M. Rosen, we have successfully helped clients throughout Florida to obtain much-needed funds in exchange for turning over their home deed to their lenders. While every case is different and cash incentives are negotiated on a case-by-case basis, the Florida foreclosure defense lawyers at the Law Offices of Evan M. Rosen have been able to successfully negotiate five-figure cash incentives to homeowners. At a time when you may be struggling financially as a result of the collapse of the real estate market, these cash payments for your deed can go a long way toward helping you get back on track.
Contact Our Florida Foreclosure Defense Attorneys Today
At the Law offices of Evan M. Rosen, our first priority is always to help clients to understand their legal rights, to formulate a plan appropriate to their financial situation and to get the best results possible. Whether that is through a deed in lieu of foreclosure or another approach, we will work with you to find the right choice for you at an affordable price. Contact us today at 754-400-5150 or through our online form to schedule a FREE CONSULTATION to learn more.
The American Dream of homeownership was crushed for so many American families because of the greed of Wall Street and the resulting collapse of the real estate market. Let the lawyers at the Law Offices of Evan M. Rosen help you to get back on track to reclaiming your piece of the American Dream.