# Deed in Lieu of Foreclosure



## AcadianTravellers (Sep 8, 2012)

Can someone tell me what it consist of? I know it will affect my credit score, but can they still come after me for something ie. more money?


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## FractionalTraveler (Sep 8, 2012)

AcadianTravellers said:


> Can someone tell me what it consist of?



This is an agreement between an owner and Marriott to give back the unit week(s) in lieu of Marriott foreclosing the property.

An owner may request this but as I understand Marriott doesn't have to agree with it or make an offer to provide it.

An owner can always try to negotiate their exit strategy.  Remember, it’s usually in Marriott's best interest to work out a deal with the owner.  It costs them some money to process the transaction and in the end it’s reported as an operational loss at the property.

I think the two main areas where they go after this transaction is (1) Delinquent Loan Payments, (2) Delinquent MF.

I suspect we will see some level of strategic dumping of units from owners who belong to the DC points system and have a portfolio of properties enrolled.  To some folks it might make sense to dump a week that has high MF and very little return value from assigned DC points.  These folks still have other legacy weeks which can be converted to points and used so making a strategic foreclosure may make sense to some owners.


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## AcadianTravellers (Sep 8, 2012)

What are the consequences beside your credit taking a bang?


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## dioxide45 (Sep 8, 2012)

AcadianTravellers said:


> What are the consequences beside your credit taking a bang?



Are you doing this because of delinquency in maintenance fees or a mortgage for the timeshare? Not sure if a deed in lieu for MFs would hurt your credit score, but a deed in lieu for mortgage delinquency probably has already taken the hit because you would have to be behind on mortgage payments in order to do the deed in lieu.


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## FractionalTraveler (Sep 8, 2012)

AcadianTravellers said:


> What are the consequences beside your credit taking a bang?



In my opinion, the credit hit is way over blown.  I have 2 friends who had to give up their units because of extended job loss and they told me their credit was minimally impacted since they wrote letters to be included in their credit files explaining that the real estate foreclosure on their report was a timeshare.

I personally think banks and car dealerships could care less about foreclosed timeshares.  Obviously, if there are other negative items on the credit report besides the timeshares, I would expect the credit hit to be much larger and the impact to the consequences more prevalent.

I can't comment on other consequences since I have not been through this personally, but I would encourage others on this BBS who have experienced this to help out any fellow TUGGERS in need of this type of information.


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## AcadianTravellers (Sep 8, 2012)

We are DC points owners only.  We haven't paid since March 2012, purchased in March 2011.  They offered us a deed in lieu and yes it already affected my credit score.  That don't bother us, because we don't plan on making any big purchases soon.  

I went to our bank and they told me that after they would still lend me some money even if our credit was hit by this, but want to know if they can still come after me once the deed in lieu is signed.

Any advice would help!

Thanks.


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## dioxide45 (Sep 8, 2012)

I am not sure if Florida is a recourse state or not. Though I would think that would only matter if they actually foreclosed. Either way, just be sure to get everything in writing indicating that after the deed in lieu is done that you will have no further obligation and no further monies owed on the loan.


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## AcadianTravellers (Sep 8, 2012)

Thanks.  I was planning on them providing me a letter of that sort prior to signing the deed in lieu.  I'm waiting for it in the mail anytime.


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## b2bailey (Sep 8, 2012)

*We did a Deed in Lieu on our Oceanwatch Property*

Last year a job loss caused us to be unable to make the monthly loan payment. We advised Marriott of the situation and they prepared paperwork, we signed and have not heard anything more from them. We did lose all that we had paid, our down payment and several years of monthly payments. In years to come I believe lenders will be more understanding of things like Deed in Lieu and Short Sales. It is a sign of the times and reflects on credit report better than a foreclosure.


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