What is a deed in lieu of foreclosure?

A deed in lieu of foreclosure is a legal agreement between a homeowner and a lender in which the homeowner voluntarily gives up their rights to a property in exchange for the lender releasing them from their mortgage debt. This type of agreement is typically used when a homeowner has fallen behind on their mortgage payments and is facing foreclosure. In North Carolina, a deed in lieu of foreclosure is a contract that must be mutually agreed upon between the homeowner and the lender. The deed must satisfy all legal requirements, including the lender releasing the homeowner from all future mortgage payments and releasing any claims to the property. The homeowner must also agree to move out of the property and surrender it to the lender. Afterward, the lender will be the new owner of the property and can decide to either keep it or resell it. In addition, the lender may also require the homeowner to pay a fee for executing the deed in lieu of foreclosure.

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What is a deed in lieu of foreclosure?

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