Deed in Lieu as pertains to 80/20 Mortgages + (approval, credit, bank)

[Taynxtlvl]

So my question is fairly simple. I own a townhome puchased in 2006. I decided to sale my home and I've had my home on the Market for a year and have gone through all the traditional steps. Full sale/appraised price, and had a few super low ball offers early on, The market kept getting worse and the offers kept getting worse. So then with my realtor and a mediation companies help we went the short sale route this summer. But to no avail as just a couple weeks ago Wells Fargo denied the short sale on both of the offers we had stating that I the owner make enough income to support the house payments according to there investor guidelines (It infuriated myself and the realtor) That should be irrelevant, they had two perfectly good offers and did nothing with either, and although the bank which holds the 20% mortgage was ready to wheel and deal to go to closing without Wells' approval everything hit a dead standstill. And we lost both potential offers who had been standing by for 3 months.

So this week I listed the home for sale for full appraised price (Which no buyer now days is going to pay, and why should they) And also for Rent.

So my stance is at this point, I'm kinda "Over" The whole situation, my plans are to move out west next spring/summer. (Renting of course) And with the winter approaching people in general move around less. I don't neccesarily wish to rent the home out, but am hoping it will. If not I will likely do a deed in lieu and take a hit to my credit which is pretty much Sterling up to this point. I figure that at 27 years old I'll buy a home again once I get married like in 5 years or something.

How does a deed in Lieu work in 80/20 situation?