Deed in Lieu of Foreclosure is foreclosure, period.  There’s some technical differences worth covering but it’s basically a foreclosure.  At least in the state of Georgia.

Essentially, a Deed in Lieu of Foreclosure is where the bank allows you to “choose” foreclosure voluntarily foregoing the legal process entirely.  In essence, you save the bank the $1,100 that it cost for them to foreclose on your home in the state of Georgia.

So what’s the benefit to the home owner?

There is a brief opportunity to negotiate the terms of the foreclosure, most importantly, how the debt gets handled.   However, over 90% of most home owners will never even consider doing this, so it’s a moot point.

The other benefit?

As a short sale seller you reduce your overall balance owed to the bank by the amount of savings you save the bank… so in this case, $1,100.