A property that was booked at $100,000 six months ago and then could come back as collateral at a different amount will raise flags.

A pre-printed letter can be used from the borrower to the lender.At this point, the lender made the mention of the alternative and the borrower has elected to take that alternative and the borrower is requesting the alternative as a solution to be considered by the lender.Now, the lender should show evidence of due diligence (title search) of the collateral and find if the acceptance of any deed would be acceptable.

The challenge was to get all the money that we contributed back out (via refinance and subsequently converting a collateralized line to LTD on the balance sheet) as (ultimately) a cash distribution.

property could have been used as cross collateral for other deals multiple time.s

If they told him they will no longer pursue him and continue to uphold that agreement, the lender has no remedy that I can think of to recover the collateral.

This way, you and the note holder have signed for the loan in an LLC for 300/400K, probably get that on collateral alone without a personal guarantee.

Collateral, who has skin in the game, as this is a risk issue it's also something a new lender needs to understand; especially since there are so many foreclosures going on.

Having been both a mortgage banker for 18 years as well as an insurance agent for 3.5 years, I can tell you, the lender has the right to require you to have coverages that secure their collateral.

I've heard of loans that use retirement accounts as collateral.

@Andy Whitcomb I talked to a lender the other day and he mentioned being able to do a credit line using the property as collateral.