If we are upside down on our home and have tried every avenue to try to keep it, how do we surrender our home without going through bankruptcy?

UPDATED: Sep 29, 2022

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If we are upside down on our home and have tried every avenue to try to keep it, how do we surrender our home without going through bankruptcy?

And what type of attorney would we use?

Asked on August 11, 2015 under Real Estate Law, Tennessee


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

The most important thing to bear in mind is that there is no right to surrender your home: 1) the lender doesn't have to take it; and 2) the lender has the right, unless otherwise agreed to in writing, to take the home or repossess it and still sue you for any remaining balance on the loan. While you can try to negotiate giving the lender in your home as satisfaction in full of the mortgage debt, and it is worthwhile to try, you can't count on being successful--the lender may legally refuse to work with you. 

An attorney who handles foreclosures or short sales would be a good choice to assist you--they would be familiar with negotiating with banks and should know how to put pressure on the bank to agree, by leveraging the foreclosure process and any rights you have thereunder. Another possibility would be an attorney who handles credit issues and bankruptcies, since he or she should have general experience in dealing with creditors.

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