The latest question in the local real estate market seems to be about the Deed-In-Lieu of Foreclosure and how it can help. A Deed-In-Lieu of Foreclosure was traditionally a release of all liability on a mortgage note, provided that the borrower hand the deed to the lender and leave the home in “broom swept” condition. Lately, some lenders have offered cash incentives to borrowers who are willing to accept a Deed-In-Lieu rather than allowing the property to go to Trustee Sale. The problem in Nevada is that the Deed-In-Lieu of Foreclosure does not necessarily mean receiving a full release of all liability on the mortgage note. In fact, absent specific deficiency release language, the lender may pursue the deficiency for up to six years with a Deed-In-Lieu, whereas a first priority lender may only go after the deficiency for six months on an actual foreclosure.
Kelle L. Kuebler, Attorney*
3 Responses
It seems strange to me that a lender has only 6 months on a foreclosure debt but 6 years on short sale and deed-in-lieu to collect. Is that just the way the law has been written. Why not just be foreclosed on and not do a short sale>
I was foreclosed on a non primary residence back in July 2009. I have never received any notice of deficiency judgment or a 1099a or 1099c. I don’t like surprises, should I pursue this or just be happy.
I have a home in Las Vegas I had to leave due to a change in jobs. I was unable to sell it and am no longer able to afford the mortgage payments. Is there anything I can do to avoid paying taxes?