If a lender signs a deed in lieu of foreclosure, does a release also need to be recorded to prevent the lender from pursuing a deficiency judgement now or in the future?
Anyone??
Hi,
Since I don't know your specific state law, I would ask for and get signed a release from the lender.
Better to be safe than sorry.
Good luck,
GR
First of all, the lender does not sign the deed, the homeowner does as Grantor and the lender is the Grantee in effect giving ownership of the property to the lender so that they don’t have to foreclose to get it back. Once the deed is accepted, it is legally their’s. Depending on the state, the lender can absolutly pursue a deficiency judgement pursuant to the loss they suffered from re-selling the property compared to the debt that was owed at sheriff’s sale OR the projected loss as a result of the as is value of the property (condition) when it’s put on the market as an REO… Since this is right they may or may not pursue, I would check with your local attorney in your state. Remember, some people have racked up debt on houses even more than the house is worth!
Hi,
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Thanks