I have heard and read a lot about the Cash for Keys programs that banks offer renters or current occupants after the home has been foreclosed on.  Cash for Keys is basically a monetary incentive that the bank will offer to the resident to move out by a certain date, thereby gaining possession of the property quicker and cutting losses.

To read a great article loaded with details on this, go to John Occhi's post, "I Don't Get It!  The Bank Forecloses on Their home and Then Pays Them To Move...Or Why Cash for Keys.

So what is Cash for Keys...with a twist?  Well, today I had lunch with a friend and was literally blown away.  Now some of you may read this and think, "Gosh, that's not so surprising."  But I was speechless and for those of you who know me, that is an anomaly in and of itself.

I knew my friend was not doing well.  He was plagued with over $100,000 in medical bills and the finances were going downhill fast.  He did not want to face foreclosure, so he called his mortgage companies (he had a 1st and 2nd mortgage) to see if something could be worked out. 

He called the 2nd mortgage company and asked if they would be willing to remove the lien from his house.  They were willing to do so for $5,000.  He did not have that kind of cash, so he then called the 1st mortgage company and asked if they would help.  Long story short, the 1st mortgage company paid the 2nd mortgage company the $5,000 to release the lien.  Then the 1st mortgage company turned around and paid my friend a good amount of money to "turn in his keys". 

No foreclosure process EVER took place. 

What blew me away the most?  On his credit report, the mortgage companies reported:

Mind boggling, but I am very happy for my friend!