Deed in Lieu - Fresno Bankruptcy Attorney

A deed in lieu agreement is another option for individuals seeking to avoid foreclosure, but who do not have the financial means to continue making payments on their mortgage. A deed in lieu is an arrangement in which the mortgage lender agrees to take the deed of the property in lieu of a foreclosure proceeding. You surrender the deed to your home to the mortgage lender, and any remaining balance on your mortgage is forgiven. This is a good option for some individuals who have substantial equity in their home, but who cannot find a buyer for a short sale.

With a deed in lieu agreement, you or your attorney will need to negotiate directly with the lender. You will have to arrange a suitable timeline to turn over the deed and vacate the property - one that will satisfy your lender's desire to get the home back on the market, but that will still allow you the time you need to move forward and find suitable arrangements for your next residence. You will also be expected to pay the fees associated with transferring the property to the mortgage lender - and in some instances, these fees can be expensive.

As with short sales, any forgiven principal balance may be subject to a forgiveness tax. And the amount forgiven must be reported as income on your federal taxes as well. This can create an additional tax burden for some individuals, especially those who are borderline when it comes to being in the next highest tax bracket. Therefore, the decision to go through with a deed in lieu arrangement is one that must be carefully evaluated.

If you are considering a deed in lieu arrangement with your mortgage lender, talk to one of our Fresno County Bankruptcy attorneys today - we can help you to decide whether or not a deed in lieu is your best option. We offer objective, professional advice and a free, no-obligation case evaluation, so that you can complete information about your legal rights and any choices you may have when it comes to avoiding foreclosure on your Fresno County home. Contact us today and let one of our reputable Fresno County Bankruptcy Lawyers assist you with understanding bankruptcy law, deed in lieu arrangements, and your rights and obligations under the law.