This entry was posted on Wednesday, July 18th, 2007 at 7:32 am and is filed under Did You Know?. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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The urban myth that one can just send a lender the keys to their home in order to escape any further obligation to the lender is entirely false. Sending the keys to the lender is the single most expensive and stupid thing you can possibly do when you find yourself with an asset worth less than you owe on it.
Why?
Because the lender is going to sell the asset (your home, car, boat etc) for less than you could have likely sold it for, then proceed to charge you an array of fees for having done so, as well as go after you for the balance of what is owed minus the paltry sum they were able to sell your property for.
You should instead try to sell the property on Craigslist, eBay, local classifieds, or via a discount/low commission broker or auction house. Yes you may be selling the item at a loss, but you’ll be far better off than you would have been after the lender hit you with repo fees, bad credit marks, and a possible lawsuit.
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