What are the disadvantages to a deed in lieu of foreclosure?
Disadvantages to a deed in lieu of foreclosure
- The word “foreclosure” shows up on the credit report.
- Can be devastating to a credit score.
- Waiting period to get a mortgage loan can be equally as long as for a foreclosure.
- Unlikely to get a deed in lieu of foreclosure if you have second or third mortgages, home equity loans, or tax liens against your property.
- Getting a lender to accept a deed in lieu of foreclosure is difficult these days. Many lenders want cash, not real estate -- especially if they own hundreds of other foreclosed properties..
