It seems an incongruous notion: starting or completing a foreclosure action after taking a deed-in-lieu of foreclosure. But it can be done and sometimes it may be imperative to do so. The process of foreclosing on one’s self, though, appears on the surface to be anomalous and so the ability to foreclose is nonetheless often viewed with incredulity. Consequently, considering at least the underpinnings of the pursuit should be worthy. Both the impediment and the solution are found in the doctrine of merger, later discussed here in context.
Basis of Deed-In-Lieu
If it proceeds to a conclusion, a mortgage foreclosure ends with a judicial sale of the mortgaged premises. One goal of the action, therefore, is to arrive at that sale so that the value of the property can be unlocked and the foreclosing lender can be paid whatever that value is, up to the sum owed upon the mortgage debt as assessed by the court in the judgment of foreclosure and sale.1
