Extremely IMPORTANT NOTICE: Exercising this option involves the legal transfer of your rights of entitlement to your home. It is suggested that you consult with an attorney or knowledgeable CPA before exercising this option.

One of the hardest things in life is knowing when to let go. A great portion of this site is dedicated to assisting you in devoting your energy to loan reinstatement efforts. Reality, however, suggests that loan reinstatement is not always the practical solution or in the best interest of the borrower or lender.

Financial situations can and do change. For this reason it is necessary to discuss alternatives to getting back on track financially. One such option is the voluntary transfer to your lender of your rights of entitlement to your home in exchange for the dissolution of the mortgage debt. Simply put, by utilizing this option you are saying to your lender, "I will give you this house in its present state along with any equity it may hold in exchange for your allowing me to walk away from the balance owed on the home including any amounts that might be past due.

One major advantage borrowers enjoy when choosing this option is minimal credit impairment if their lender approves this workout option. The disadvantage comes with a loss/forfeiture of any equity the home may have. Additionally, the borrower will have to leave the home as all rights to the home will terminate.

This workout scenario should only be utilized as a last resort option for borrowers whose financial situation has changed so dramatically that redemption/reinstatement of the loan is impossible making foreclosure inevitable. Borrowers interested in this option should contact a knowledgeable attorney for legal issues and ramifications related to this topic.
Finally, keep in mind that acceptance of this option must be obtained by your lender in order for it to be valid.