The Consumer Financial Protection Bureau mentions another option for avoiding foreclosure. In a deed-in-lieu of foreclosure the homeowner and mortgage lender mutually agree to exchange the deed to the home to the lender, who then drops foreclosure proceedings. By voluntarily turning over ownership of the home to the lender, the homeowner avoids the stress, cost, and greater credit damage of the foreclosure process.

The lender may also participate in a “cash for keys” program in which the lender will pay the homeowner’s relocation costs. This allows the lender to quickly take possession of the property and prep it for liquidation. In addition, consumers are advised to secure a complete waiver of deficiency to ensure they have been released from liability of any gap between the total loan and the amount of money the lender receives in the sale of the home

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