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‘Deed In Lieu’ is a common short-hand term for a particular situation. Namely: when a borrower can’t make loan payments and hands over their deed to the property instead, so that the lender does not have to take the home.

The full phrase is ‘deed in lieu of foreclosure’ — the borrower is surrendering the deed so both parties can avoid the cost and impact of foreclosure. It is faster, generally less expensive for the lender, and generally less damaging to the borrower’s credit. However, the deed in lieu must be voluntary for both parties. The lender must agree that the deed value meets the loan amount owed — otherwise, they might have the right to seek additional payments through a deficiency judgement. Deed in lieu is typically a last resort, and only becomes an option when losing the property has become inevitable.


At Title Junction we care about helping you stay informed throughout your real estate transaction. Have questions? Give us a call at 239.415.6574.

In case you missed it, check out our last Title Junction post: Remote Online Notarization: The Future of Signing Documents

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