Personal monetary troubles and factors like underwater mortgages, which have resulted from property devaluation, have led numerous homeowners to simply walk away from their mortgage obligation out of frustration and a feeling of hopelessness. However, there have been programs implemented which can help homeowners avoid a foreclosure process, like deed in lieu of foreclosure programs. Homeowners who have attempted to sell their property because they are unable to continue making their monthly home loan payment, but have been unable to do so, may qualify for a deed in lieu of foreclosure option from their servicer.
In cases where the homeowner may face foreclosure, some servicers have allowed a deed in lieu of foreclosure transaction to take place, which allows a homeowner to transfer the ownership of their property to their servicer and this will be seen as a satisfactory “payment” of the total amount due on their home. While some homeowners who may have other mortgages, like a second lien on their home, may not qualify for a deed in lieu of foreclosure plan, homeowners who are simply struggling to meet their primary mortgage obligation have seen some success in this foreclosure alternative option.
Also, information on the Home Affordable Foreclosure Alternatives Program states that certain homeowners may receive up to $3000 to help with relocation costs. Obviously, homeowners who are in a troubling situation in their personal financial life may be unable to meet the entirety of the costs which will be required if they are to relocate to an alternative living arrangement.
Many homeowners who surrendered the deed to their home often turn to apartments, or in some cases renting a house, but this typically requires costs like moving expenses and security deposits to be met, which could be beyond a homeowner’s present means to meet. While these relocation expenses and deed in lieu of foreclosure programs are not available to all homeowners, advisers suggest that homeowners explore these options and talk over alternatives with their mortgage servicer before surrendering to a formal foreclosure.
It goes without saying that walking away from a home loan can do a great deal of damage to one’s credit score and is highly advised against, so homeowners who are in a frustrating position and have considered simply leaving their mortgage obligation are, again, being prompted to explore these foreclosure alternatives through deed in lieu of foreclosure plans or even short sale opportunities.