The act of giving a property back to the lender without undergoing foreclosure. While the end result is the same – the lender regains possession of the property – the expense and repercussions of the foreclosure proceedings is avoided.
A means of escaping an overly burdensome mortgage. If a homeowner can’t make the mortgage payments and can’t find a buyer for the house, many lenders will accept ownership of the property in place of the money owed on the mortgage. Even if the lender won’t agree to accept the property, the homeowner can prepare a quitclaim deed that unilaterally transfers the homeowner’s property rights to the lender.
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This glossary post was last updated: 29th March, 2024.
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