deed in lieu reporting

There is indeed an account status specifically for deeds in lieu. It is a status 89. They should have updated your credit report with the new status, and removed the "foreclosure initiated" comment.

This may sound like a dumb question but is a status 89 better for my credit score than "foreclosure initiated"? It seems like it would be but one never knows....I realize neither is good. Thanks!

The lower the better. 13 is paid on time. 71 is 30 days late, 78 is 60 days late ... 84 is 180+ days past due ... 97 is a chargeoff. So your "deed in lieu" status (89) is not quite as bad as a chargeoff, but it is still a bad mark nonetheless.

Ironically, the "Foreclosure initiated" is not really an account status, but rather a "comment" (BO) associated with the account. For example if your account was 180 days past due and foreclosure started, then it would be reported as a status 84 with comment BO.

We were issued a satisfaction of mortgage on this house. I believe that is because the bank's appraisal plus what we paid them in cash equaled the loan amount. Wouldn't that be better than a "foreclosure initiated" and shouldn't we dispute this with the credit bureaus?

Well, legally they had to issue a satisfaction (or else whoever buys that house down the line would have defects on the title).

Notwithstanding, the "foreclosure initiated" comment really should be removed. Go ahead and dispute it; it should be updated.

Below are exerpts from the MetroII manual, which are industry standards for credit reporting: