Thursday, November 26, 2015

Deed-in-Lieu of Foreclosure for Seniors Overwhelmed with Home Payments

Question: We are seniors, living on a pension. We had our home on the market for over 3 years and we were unable to sell it. We can no longer keep up with the home payments and we need to go live with our son for health reasons. We were told that we can sign the deed to our home over to our lender. What would happen if we did that?

Response: If you have a clean title, you can do a deed-in lieu of foreclosure where the lender takes the deed to your house and you walk away mortgage-free. The only caveat is the potential tax consequences but if it’s your primary residence, there may be none. You would need to consult with your accountant. This depends on the amount of your mortgage in comparison to the value of your home and whether the lender has to forgive a lot of your mortgage debt. More likely than not, you will not face any tax consequences, especially since you are retired. It is a much better option than letting the bank foreclose on your property.
In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.

The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
Copyright © 2015 Law Office of Svetlana Kaplun, P.C.

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