A deed in lieu of foreclosure—often referred to as a deed in lieu—is a deed by which a borrower (mortgagor) transfers fee simple title to a lender (mortgagee) to satisfy a mortgage debt.

A deed in lieu of foreclosure is a substitute for the foreclosure process and a delinquent debtor or mortgagor may avoid paying a deficiency balance (if the home is worth less than the amount owed) and may lessen the impact on their credit report by signing a deed in lieu.

In Alaska, a deed in lieu of foreclosure is a legal instrument where a borrower voluntarily transfers ownership of their property to the lender to satisfy the outstanding mortgage debt and avoid the foreclosure process. This option can be beneficial for both parties as it allows the borrower to avoid the negative consequences of a foreclosure on their credit history and potentially avoid liability for any deficiency if the property's value is less than the debt owed. For the lender, it provides a quicker and often less costly means of recovering the debt without going through the lengthy foreclosure process. Alaska state statutes and federal law govern the execution of a deed in lieu of foreclosure, ensuring that the transfer is done legally and with clear terms to prevent future disputes. Borrowers considering this option should consult with an attorney to understand the implications, ensure that the agreement includes a release of any deficiency liability, and to navigate the legal requirements for executing the deed in lieu.