CITI Deed in Lieu, No short sale. Done?

**mashad** · 12-05-2011, 12:37 PM

I am trying to do a DIL with Citimortgage without going into short sale first. I called them about a month ago and told them about what was going on with my property. (We have a collapsed cesspool and cannot afford to install a new septic system, total cost= $25K). I was transferred to the short sale department and a lady there advised me that since we have a fannie mae loan, we should go ahead and fax in our paperwork for a deed in lieu. So we did that. I called two days later to make sure the fax went through and was told by someone in the short sale dept that they don't accept DIL unless the property has been in short sale. I got kinda upset and told her that I spoke to a lady named Lisa who had instructed that I should go ahead and fax my DIL paperwork. The lady on the other end, basically told me to stop yelling and being upset with her and that she's just telling me the facts. I wasn't yelling and yes I was upset but not rude.
We had left the property and are living in a rental right now. We are paying less for rent but cannot afford to keep paying for our mortgage at the same time. We are still paying for utilities and security for our home. We are about 90 days late on our mortgage. We did consider a short sale but our real estate agent informed us that the chances of our house selling with a busted cesspool will be very slim. She told us finding a buyer with cash to buy our house is going to be hard as banks will not give loans to buy our house. It did not help that we also live in a very undesireable location and the house itself needed some work. After consulting a real estate attorney, we were advised that a deed in lieu is our best option.
On 11/23, we received a letter from a Citi's rep stating that she will be working with us on our case and to contact her if we have any questions. On 11/25, we received 2 letters from Citimortgage that we have been denied for loan mod, short sale and DIL because our income is too high. I completed the online forms on citimortgage website about a month prior to submitting my DIL package. We received an email about 2 days later from Citi's home owner's support specialist asking for formal bank statements and to complete the 4506tez.pdf and dodd frank form. We were also told that she will be ordering a BPO on our property. We emailed our bank statement, completed the forms and asked her about the denial letters. No response yet. We also received a call for an appointment for an internal BPO of our property. So far I am confused about what is going on.
I don't know what to expect with the internal BPO. I hope they are convinced that my house will not sell on the market even with a short sale. I know we qualify with HAFA but it is really up to citimortgage to waive short sale and go on straight with deed in lieu. All we want is to just get this over and done with. I have a credit card with Citi and they had already decreased my credit limit to the point of almost maxing me out.. so I know my credit score has already started to take a hit.
I was just wondering about our chances of settling with a DIL with citi and if anyone has dealt with citi, hafa and a straight on DIL. Thanks.

**mashad** · 12-05-2011, 12:58 PM

Just got off the phone with Citi. Apparently were we denied loan mod, short sale and DIL with HAFA because our gross income is too high. (WTF!)We are however still in process with Citi directly to determine if we would be able to do a DIL with them. Anyone has any thoughts on this?

**mashad** · 12-05-2011, 03:16 PM

Got an email response from my caseworker telling me to ignore the letters as they are auto generated. Now what? *confused*

**Cat Damiano** · 12-06-2011, 02:03 AM

mashad,

Loan modifications, short sales, and deed in lieu are given under circumstances of hardship. If you are current on the mortgage, it would be very difficult to plead a case of hardship or imminent default. There are certain factors when going through the process such as your payment including principal, interest, taxes, and insurance (hazard), would need to be over 31 percent of your gross income. Is your payment more than that? Are you current?

**mashad** · 12-06-2011, 12:43 PM

We are about 90 days late now, never been late even when I got laid off. We scrape by month to month. The big cost of the repair and installation of a new septic tank is what we cannot afford. $25K in total. No big savings or rich relatives to borrow from. I have documented all our hardship in my letter, got laid off, medical issues, missed work, collapsed cesspool that renders our home un-livable and unsanitary. If you can't live in your own home and basically forced to move out in order to live like a civilized human being again I would think that is a hardship. So I don't know if Citi would consider this as hardship. If they don't, screw them.

**Cat Damiano** · 12-06-2011, 12:48 PM

You will just have to see what they say. I hope they are able to work with you as I would agree. But unfortunately, what we deem as a hardship and what the lenders deem a hardship are two very different things.

Please keep us posted on what they say.

**SOUTHCAICOS** · 12-07-2011, 09:31 AM

I just finished a DIL with Citi........they require you to attempt a short sale for 90 days before they will approve or send you DIL papers to sign. You can either try to list it for the 90 days and not tell the realtor about the house problem and then if he has any offers tell the realtor you will not submit any short sale offers without a written contract from the bank for the DIL which is what I did. The bank won't give you a written contract so it will buy you the 90 days then cancel the listing. Otherwise just skip the DIL and enter into an agreement to just give the house back......I forgot what it's called but you work with the bank and let them foreclose. In the meantime stay if you can to save rent money but in your case sounds like you need to get out now if you have no septic. Help them as best you can to accelerate the foreclosure to get it done before Jan 2013 then you can use the Mortgage Forgiveness Debt Relief Act and Debt Cancellation then they can't come after you for any losses.

The Mortgage Forgiveness Debt Relief Act and Debt Cancellation

**mashad** · 02-28-2012, 03:28 PM

Hi all, just an update...
We are still in the process of deed in lieu without attempting a short sale. Our DIL has made it to the CITIMortgage negotiator. I emailed today to ask about our status. This is the response I got, "We are still waiting on title. I will let you know as soon as we get a response from the attorney".
Does this mean anything...? We have no liens on our property so our title should come up clean. Trying not to get my hopes up that this will be over soon.

**Cincheetah** · 03-01-2012, 04:41 PM

Originally Posted by mashad

Hi all, just an update...
We are still in the process of deed in lieu without attempting a short sale. Our DIL has made it to the CITIMortgage negotiator. I emailed today to ask about our status. This is the response I got, "We are still waiting on title. I will let you know as soon as we get a response from the attorney".
Does this mean anything...? We have no liens on our property so our title should come up clean. Trying not to get my hopes up that this will be over soon.

Please post if you have any luck. I read Citi is doing more DIL over foreclousers to save money on legal fees etc ...

**mashad** · 03-05-2012, 02:24 PM

Received a phone call from an agent today asking to get access to the house so she can do a walk through, change the locks and winterize the property. I asked if this is a BPO and she said yes. I told her that someone else had done a BPO in dec. She told me that this is for the deed in lieu and that she wants to make sure that everything is done according to the terms of the deed in lieu. I told her I have not received any paperwork or updates from CitiMortgage and the last time I heard from them was last week and that they are still waiting for the title. No updates or paperwork since then. The agent was as baffled as I was. Emailed Citi negotiator about this asking if our deed in lieu is approved. Waiting for reply, will update. Is this a good sign that it will be over soon?

**Cincheetah** · 03-05-2012, 02:59 PM

I think that is great news! May I ask, at this point are you 6 mns behind? In any event, I'll keep my fingers crossed for you! I think
this all reads pretty promising! Good luck!

**mashad** · 03-05-2012, 03:08 PM

Hi Cincheetah, we stopped making payments in September last year and moved out in October. Started the DIL process in mid November. *keeping fingers crossed*

**Cincheetah** · 03-05-2012, 03:21 PM

I think that moved along pretty well!

**mashad** · 03-06-2012, 09:39 AM

So I got a reply from Citi today.

"The inspection has to be complete in order for us to see if you qualify for the DIL. Please reschedule asap. We cannot proceed with any paperwork until we see the homes condition".

So from my understanding, Citi wants to winterize and change the locks before an DIL agreement is made. Is this standard practice for DIL with Citi? They have done a BPO in Dec and pictures inside and outside the house were taken. Having the bank change the locks basically gives them ownership of the house without any form of agreement of DIL. I'm confused. Can someone explain this?

**mashad** · 03-06-2012, 11:05 AM

Got another response from citi after writing them this email.
"Well, CitiMortgage have already seen the house. A BPO was done in December. Pictures were taken. The house has not changed at all since then. All appliances are still there. Electricity and security alarm still runs. I don't understand why CitiMortgage needs to change the locks and winterize the house before any agreement of deed in lieu is made. Is this standard procedure with deed in lieu? Wouldn't the usual practice be, signing an agreement of deed in lieu before handing the house/keys to the bank? Please explain. Thank you".

My email was forwarded to a higher level negotiator it seems... and this is their response.

"Yes. They can definately sign everything first. But the DIL is not finalized until they are out of the home and we have done our portion of the winterization and securing".

So I asked them to forward all the paperwork. Will be contacting my attorney for review of paperwork before signing anything.

**mashad** · 03-15-2012, 12:45 PM

Got this in my email...

"I am pleased to inform you that your application for foreclosure alternative assistance has been approved. You will be receiving notification detailing the terms of your solution within 5-7 business days. Should any further information be required, I will contact you."

Our online citimortgage account is back too after being suspended since last year. Still, I am not convinced until I get the paperwork, reviewed and signed.

**Cincheetah** · 03-15-2012, 03:48 PM

Congrats! I don't blame you for being reserved, however I do think you are moving forward!

**mashad** · 05-22-2012, 07:18 PM

Just to summarize, our cesspool collapsed last year and we can't afford to pay $25K to have a septic system installed. Can't live there so had to move right away. We did not even attempt a short sale. 8 months later, we signed the deed in lieu documents after getting the go ahead from our attorney. We received an email from citi's attorney stating, "We received the title update and the title was clear to proceed. The documents were forwarded on 05/08/2012, to the attorney in Oregon who will send them to the county to be recorded. Thank you." So I assumed the deed in lieu went through and approved. Received an email from CITI last week, "We are writing to inform you that your credit dispute has been reviewed. We have sent additional information by mail to your address on file." We have yet to receive anything.

Yesterday our active security alarm went off and the police were called. Apparently, the property now is in the hands of a real estate company who had broken in to re-key the house without our knowledge. We rushed there to make sure everything is ok. Saw a notice on the door from the real estate company stating that the house is foreclosed. Talked to the realtor on the phone and she had no idea it was a deed in lieu. She just assumed it is a foreclosure. This really caught us off guard, we were waiting for some sort of notification from the bank so that we can at least turn off the power and the security alarm. To make matters worse, we were told to leave the property as it no longer belongs to us. I don't really know how to feel regarding this. I just don't want any surprises. I want it to be over and done with. Any advice?

**Cincheetah** · 05-31-2012, 03:18 PM

I was curious to see if ou have made any progress? Was your DIL completed? My buyers walked on the short sale, I asked for a DIL the short sale negotiator told me I was going to have to pay on the the title check and relist for 90 more days for a DIL. Two days later I recieved a call from my new case worker - she didn't say I needed to relist, even though I mentioned I was told to do so. All of my paperwork is current and I'm trying to understand this process. In the meantime, I've received a letter from an attorney, although CITI says they have not filed for the FC process yet. My head is spinning. Just wanted to see if yours was complete and did they waive the deficeincy? Thanks so much for anything you can share.

**mashad** · 03-01-2013, 01:22 PM

Late reply... My DIL was completed. No paperwork given... No 1099C as of today. Checked my credit report and it does indicate DIL, under remark. House sold after that in less than 3 months after it was put up for sale. I can't believe someone bought the piece of crap property with a collapsed cesspool. Did not look like they built a new septic system either. Not even sure if they knew about it *shrugs*