What’s best to do regarding a Deed in Lieu of Foreclosure and a Chapter 7?

UPDATED: Sep 4, 2012

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

UPDATED: Sep 4, 2012Fact Checked

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

What’s best to do regarding a Deed in Lieu of Foreclosure and a Chapter 7?

I filed a Chapter 7 in Virginia in June. The mortgage lender and I have agreed to a Deed in Lieu of Foreclosure and the Chapter 7 Trustee has approved it. The mortgage lender had their attorney prepare the DIL who is also the mortgage Trustee. Is it OK for the mortgage Trustee to prepare this? And is it ethical?

Asked on September 4, 2012 under Bankruptcy Law, Virginia


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

So long as the bankruptcy trustee has approved the deed in lieu of foreclosure as to your home to your lender with respect to your Chapter 7 bankruptcy filing, there is nothing improper for you to sign such a document and transfer title to your home to the lender provided there is a bankruptcy court order approving it as well.

Custom and practice in the real estate industry allows the lender the prepare such a deed in lieu of foreclosure. Such happens all the time and is ethical. I suggest that you consult with your presumed bankruptcy attorney about this deed if you truly do not understand that by signing it you are giving up your rights to the property you presently own.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption