Deed In Lieu of Foreclosure Cover Letter For Bank
If you’ve read our discussion on Deeds in Lieu of Foreclosure and have decided to pursue this Foreclosure Option, we’ve prepared sample letters to send to your lender to help you get final approval. The Deed in Lieu of Foreclosure Cover Letter outlined below is a basic example of what to send to the lender together with a Financial Hardship Letter which you’ll find with the rest of our Sample Documents.
You should make any changes that more accurately reflect your situation or use language you feel more comfortable with. Although we recommend that you meet with a lawyer to fully understand the potential consequences of a Deed in Lieu of Foreclosure, our Sample Documents can be used alone or in conjunction with your attorney.
Before contacting the bank with your foreclosure plans, get as much documentation as possible to show the bank that you have an Underwater Mortgage. Once you’ve confirmed that your mortgage is underwater and by how much, use the Deed in Lieu Cover Letter together with a Financial Hardship Letter to get the ball rolling. Be persistent as there are thousands of people making similar requests and the “squeaky wheel gets the grease” while everything else is ignored or delayed. See how the recent Nationwide Foreclosure Settlement impacts your own foreclosure.
Remember, working with the bank is much easier for them than homeowners who simply Walk Away and you need to remind them of your option to do that or Defend the Foreclosure Lawsuit if they won’t agree to the deed in lieu of foreclosure. Even if the bank agrees to your offer make sure they waive the right to pursue a Deficiency Judgment against you.
Sample Deed in Lieu of Foreclosure Cover Letter
Re: Property Address & Loan Number:
To Whom It May Concern:
We are the borrowers on the above-referenced loan. As a result of deteriorating economic conditions both personally and nationwide, we’ve been forced to dramatically alter our plans to avoid financial catastrophe. As a result, we have no option but to convey the property back to you using a Deed in Lieu of Foreclosure and need your approval to move forward.
To support our decision to execute a Deed in Lieu of Foreclosure in your favor, we’ve attached a “financial hardship” letter summarizing our overall economic condition and how we got here. We’ve also spoken with several realtors and conducted online research to determine the value of our home. Unfortunately, we’ve confirmed that our mortgage is significantly underwater and that the amount of the loan is far more than we could ever sell our home for.
In fact our loan is so far underwater that it will likely be years before it regains its prior value. [BRIEFLY EXPLAIN YOUR UNDERWATER MORTGAGE EVIDENCE HERE]
After evaluating all of our foreclosure alternatives, we’ve concluded that the only way to salvage and protect our financial future is to move on and return our home back to you. This option – including agreement to waive any resulting deficiency balance – allows us to work together and get on with our lives while avoiding the time and expense of a foreclosure lawsuit for the bank with little or nothing to gain.
As you know, time is of the essence so please contact me as soon as possible to confirm your approval or let us know if you need any additional information for the confirmation of our request.
Thanks in advance for your anticipated cooperation.