DEED IN LIEU OF FORECLOSURE
If you consider the above options and they don’t work for you, you can try the deed in lieu of foreclosure option. When you enter into a deed in lieu of foreclosure agreement, you agree to hand your home over to your mortgage lender; then, in exchange, the lender writes off your debt, even if it was more than what the home is now worth. A deed in lieu is still a foreclosure, but it’s a quicker and easier one. Once you hand over your house, your debt is scraped off immediately. This option will affect your credit score the same way a foreclosure will. However, you don’t have to wait so long to buy another home. A deed in lieu could reduce the wait time from five years to four, or even two, if you can show justifiable circumstances.
BANKRUPTCY
Depending on the severity of your financial problems, you might want to consider filing for Chapter 13 bankruptcy. This is an extreme measure, which ordinarily should be considered only after you have exhausted all other possibilities. Chapter 13 provisions provide you with an opportunity to reorganize and work with your creditors to develop repayment options. According to the U.S. Courts website at uscourts.gov, “A particular advantage of Chapter 13 is that it provides individual debtors with an opportunity to save their homes from foreclosure by allowing them to ‘catch up’ past-due payments through a payment plan.” Relief or partial relief from your other debts could put you in a better financial position to continue making mortgage payments. However, before pursuing bankruptcy, consult an attorney, who
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