A deed-in-lieu is sometimes considered by a lender instead of a foreclosure if the lender believes that doing so would result in less financial loss to them. Such may be the case if the property’s value and mortgage balance are similar. Properties with second mortgages and/or large unpaid assessments and/or judgments are not typically good candidates.
The good news is that in the case of a deed-in-lieu, the lender will likely agree to not pursue you for a deficiency later, regardless how much loss they eventually suffer on the deal. Otherwise, (at least in Florida) a lender would have up to five years to pursue you. Your credit score will of course be negatively impacted, and it will be extremely difficult for you to obtain a home loan for a minimum of two years after the fact.