After a filed or threatened foreclosure, you have decided to surrender your house, talk to the bank and see if they will just take the house without requiring you to pay any more toward your mortgage. Even if they agree to such an arrangement you would be wise to consult an attorney to be sure the deal you’re making is the one you are signing. Such an agreement by the bank will basically be a mathematical analysis of market value versus the amount you owe on your loan. If the bank can sell the house to someone new, now, and get as much as they would get from you if they sued you, the bank might cooperate with you and let you surrender it. Remember that you can always surrender a home to a bank; the real question is whether they will sue you for the money remaining due on the mortgage.
The days of driving downtown to the bank to have a cigar with “George Bailey” to decide if he will let you miss a few more payments while you are off work from a back injury, are about over. Most banks or local loan institutions sell your mortgage to a new company maybe several times in the course of the first few years of the mortgage. You will know who you are making your payments to (the loan servicer), but you won’t know anyone at that organization.
Don’t turn your back on the situation, ignoring the past due notices, and forcing the bank to foreclose. With the current status of all the big financial institutions that have lied in foreclosure hearings, and with the political pressures for mortgage companies to work with mortgagors, the financial institutions do not want to foreclose!
If you want to keep your house, there is a step to pursue before foreclosure or bankruptcy. After the recession, nearly all the big mortgage companies created “loss mitigation departments.” These new divisions of mortgage companies have the job of working with people in danger of foreclosure, to modify the terms of the mortgage so no foreclosure is necessary.