Deed-in-Lieu / Cash-for-Keys / Consent Judgment
If you can no longer make your mortgage payments, you may believe foreclosure is your only option. However, there is an alternative to foreclosure that is commonly referred to as a deed-in-lieu of foreclosure.
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.
Some times a deed-in-lieu will not be possible due to title issues, tax issues and/or bankruptcy. In this instance, the parties can agree to a judgment, with a cash payment incentive. Part of the bargain can include the bank's agreement not to pursue you for a "deficiency judgment." This is the difference between the judgment amount and the value of the property at the time of sale. If the judgment exceeds that value, the bank could come after you for a deficiency. This can be resolved via agreement. But, there are tax implications that must be explored and considered.
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 and consent judgment arrangements with every major bank and bank law firms. 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 foreclosures. 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 consultation by calling 855-55-ROSEN or by filling out our online form.
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.
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.
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 most likely negotiate a waiver of deficiency. Due to tax implications, you may prefer to not have a waiver. This is something that will need to be thoroughly explored before finalizing your decision.
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 bank to pursue terms that are best for you.
It is also possible for homeowners to obtain cash incentives for giving up the deed or consenting to judgment. At the Law Offices of Evan M. Rosen, we have successfully helped clients throughout Florida to obtain much needed funds as part of this process. Every case is different and cash incentives are negotiated on a case-by-case basis. But, 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, these cash payments can go a long way toward helping you get back on track.
At the Law offices of Evan M. Rosen, we truly enjoy treating our clients like we would want to be treated. We enjoy helping our clients understand their rights and formulate a plan that is best for them. Whether that is through a deed-in-lieu, consent judgment or having your day in court at trial, we will work with you to find the right choice for you at an affordable price. Contact us today at 855-55-ROSEN or through our online form to schedule a consultation to learn more.
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