If my deed in lieu gets approved will I be able to get approved for a mortgage when I move up North this year?

Question

I need to move up North to take care of my family. My dad and grandfather are having major surgeries and my mom cant do it herself. My lender is entertaining a deed in lieu and should have an answer by Sept 15. Will I be able to get a mortgage within the next year based on these circumstances so I can take advantage of the current market up North? I am not sure if FHA is an option? Any advice is much appreciated.

Answer 1

Deed in lieu is considered the same as a foreclosure.  FHA says 3 years from the time you can show it was paid in full.  That is not the same as the time you turn in the keys.

Good luck & my best to your dad & grandfather.

Answer 2

If you do a deed in lieu with the bank it's just like a foreclosure on your credit report.  Contact a real estate attorney to get the bank to agree not to contact the credit reporting agency with your deed in lieu in writing otherwise why bother if it's going to be on your credit file for years anyway.   Have your attorney tell the bank you'll plan to stay and fight any foreclosure with stays and you'll be living there free possibly up to a year.  

Answer 3

Nope.

Deed in Lieu is the same as a FORECLOSURE for future lending purposes.

Please don't let anyone tell you that it's not...b/c it is.

PS:  Freddie is incorrect.  The entire purpose of doing a Deed in Lieu vs a regular foreclosure (where you walk away and avoid dealing with the bank) is that you avoid a deficiency judgment and the bank gets back the property in pristine condition.

Two years ago, banks were not accepting Deeds in Lieu if you had negative equity in the home.  However, they are accepting them now b/c of the huge number of homes that are getting trashed .

Answer 4

No.  A deed in lieu is similar to a short sale or foreclosure on your credit report.  It means you didn't honor your financial responsibility.  Look at three to five years before you qualify for a mortgage again.

Answer 5

"Deed in lieu of" does not mean you are free and clear from the financial obligation with the loan provider.

Most banks do an appraisal to evaluate and conclude what the property is worth in the current real estate market.

The bank might decide to collect the difference between what you owe and what the property is worth at the time it is accepted.

Generally, the lender will not proceed with a deed in lieu of foreclosure if the outstanding indebtedness of the borrower exceeds the current fair market value of the property.

If you can not the pay the current monthly mortgage payment it would be very easy to assume that a large lump sum payment that could be more than $10000 would be very difficult to pay.

There are some financial institutions that have been helping some home owners to keep their homes in this hard and very difficult times help is out there.

You may contact me if you like additional info.

Answer 6

Not likely. Your credit will take a big hit. Also, you didn't state if you have a job up North. If you become unemployed, you won't be able to get a mortgage.