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A deed in lieu of foreclosure allows the borrower to voluntarily transfer the title of the property to the lender as a means of avoiding the foreclosure process. This immediate transfer signifies that the lender now takes possession of the property, effectively assuming ownership without the need for prolonged legal proceedings.

When a borrower executes a deed in lieu of foreclosure, they relinquish their rights and ownership, which allows the lender to take control of the property right away. This action serves to simplify the resolution of the delinquent mortgage, and allows the lender to proceed with plans for the property without the complexity and delay associated with a traditional foreclosure.

While other possibilities exist regarding the status of the borrower or the property, such as modifications of terms or implications for credit scores, these do not reflect the primary outcome of a deed in lieu, which is the lender's immediate possession of the property. Therefore, the most accurate description of the immediate effect is that the lender takes possession of the property.