Generally, after a number of missed house mayments, a bank will begin the foreclosure procedure to obtain the deed to a home in order to sell it to recover their loss. This process works for buyers who are going through hard times but will soon be able to catch up on their payments, as it gives them time to pay on their loan before losing their home. However, it works against those who know they will be unable to make these payments before the foreclosure, as it leaves a very nasty mark on their credit report for years to come, on top of leaving them potentially homeless.

First Place Bank, in Warren, OH, is asking that second group to simply turn over the deeds to their properties without foreclosure. While this still displaces them from their home, it does not leave the negative mark on their credit report, which should make it easier for them to obtain financing in the future, when they are better fit, financially, to make payments. It also keeps their report free of any further marks which would make it difficult to find an apartment -- a common problem for people whose lost their home to foreclosure.

While it is unfortunate for anyone to be displaced from their home for any reason, it does happen. At first glance, it appears that First Place Bank is being a bit harsh in their request; however, many homeowners in a foreclosure situation aren't aware of this partially credit-saving option. By asking the homeowner to turn over their deed, they're doing the right thing -- giving them a quicker and less painful way out of a situation that's bad for both the bank and the homeowner.

Read Don Shilling's full story on the issue.