Your place of business is almost as important as the goods or services you provide. However, when a business owner in Birmingham owns real estate, but finds they can no longer pay the mortgage, they are thrust in the difficult situation of facing foreclosure and possibly the loss of their enterprise. There are some foreclosure alternatives, however, including a quit claim deed.
What is a quit claim deed?
A quit claim deed — also known as a deed in lieu of foreclosure — is a means of surrendering the ownership rights over your property back to the lender. If the lender agrees to the quit claim deed, you can avoid damaging your credit to the extent it would be damaged if you foreclosed on the property.
Steps to take when pursuing a quit claim deed
First, contact your lender. Your lender may have certain requirements you must meet to obtain a deed in lieu of foreclosure. For example, your lender may request that you attempt a short sale before they will agree to a quit claim deed.
Second, send your lender a written request for a deed in lieu of foreclosure. Deeds in liu are entered into voluntarily, so in general a lender cannot move forward with one unless they have written consent.
Third, you may need to provide your lender with documentation showing you are unable to pay your mortgage. For example, your lender may need to receive copies of your tax returns or other financial documents.
Finally, read over the approved deed in lieu of foreclosure thoroughly. Ensure that your lender has waived the right to pursue a judgment if the property cannot be sold for what is still owed on the mortgage.
Seek legal advice if you want to pursue a quit claim deed
Ultimately, this post is for informational purposes only. It does not contain legal advice, nor can it promise any specific outcome in your case. If you are interested in a quit claim deed or other foreclosure alternatives, it may help to speak to an attorney.