Can I give my mortgage lender the keys to my house to avoid foreclosure?

I heard a person can surrender the keys to their home and sign the deed over to the mortgage lender to avoid foreclosure. Is this true? I guess this is seen on teh credit report still as a foreclosure, but it saves the lender some cost and you don't go through as much pain and they forgive the debt. is this true???Can I give my mortgage lender the keys to my house to avoid foreclosure?
It is true, if the bank agrees. It is usually not in their best interest to agree, as they forfeit the money you took from them. They can not obtain it via other methods as they can in a foreclosure.





Ask your lender if they will accept the deed in lu of foreclosure. If there is pretty good equity they very well might.Can I give my mortgage lender the keys to my house to avoid foreclosure?
Deed-in-lieu of foreclosure is a process in which you give away your property to the lender because you just can't pay the monthly mortgage payment any longer. The lender then sells off the property in order to retrieve a part of the loan balance you owe.





When you go for a deed-in-lieu in order to avoid foreclosure you need to sign legal documents such as the Agreement in Lieu of Foreclosure and a warranty deed, quit claim deed, or a grant deed. The first document gives the terms and condition of the deed-in-lieu, and is signed by both the lender and borrower. The second document, which is the deed, conveys legal ownership of the property to the lender.





The lender marks the borrower's note as ';paid'; and provides them with two forms, one which states the debt is canceled and the other which refers to the waiver of the right to a deficiency judgment (The lender's right to ask for the unpaid debt amount if it is not recovered totally by the property sale.





The agreement for deed-in-lieu of foreclosure is executed through an escrow closing agent which receives the borrower's note (marked as ';Paid';0 from the lender. The escrow closing agent records the deed used for the mortgaged property and sends the note to the borrower. The borrower is thus released from the liability of the monthly mortgage payments.





There might be a few tax consequencies. The lender might send you a 1099 form stating that you had a gain on the sale of the property. You should consult with your tax consultant about how to file this gain on your income tax forms.





I hope this has been of some use to you, good luck.





';FIGHT ON';
This is true depending on the lender and what state law governs the jurisdiction you are in. I would find out what the likely process will be before making this decision. Your lender may be willing to restructure the loan if that is something that you would consider. If you can and want to walk away from the property then that might be the right decision. If you can really save your credit that would be worth doing if you can confirm that the bank will avoid this default hitting your credit report.
Call the lender. Some are willing to take a deed in lieu but not in every situtation. Have you spoken to the lender's retention department? They may be able to do a modification that will help you keep your home.
If the lender agrees, it's effectively a deed in lieu; and they have no reason to accept it 99% of the time.
That is called a ';deed in lieu of foreclosure.'; You can only do so if the lender agrees.