Q: Wells Fargo said I cannot do a deed-in-lieu of foreclosure because I have an FHA-insured loan. Is this true?
A: The FHA program utilizes deed-in-lieu (DIL) transactions as a portion of its toolkit, just as any other servicer would.
However, according to HUD, borrowers are not eligible if you can "financially make their mortgage payments.”
There are also some other particulars outlined in this HUD document. If you cannot meet those requirements, you may not be eligible for a deed-in-lieu for your FHA-backed loan.
You can contact the FHA's National Servicing Center with questions at (877) 622-8525 or the FHA Outreach Center at (800) 225-5342.
A 25-year expert observer of the mortgage and consumer debt markets, Keith Gumbinger has been cited in thousands of articles covering a wide range of consumer finance and economic topics in outlets ranging from the Wall Street Journal to the Bottom Line newsletters. He has been a featured guest on national broadcasts for CNN, CNBC, ABC, CBS and NBC television networks and has been heard on NPR and other national and local radio programs. Keith is the primary researcher and writer for HSH.com's MarketTrends newsletter and has authored or co-authored a number of consumer guides on mortgages, home equity, refinancing and more.