Fannie Mae has announced a new Deed for Lease™ program. The new program allows borrowers to voluntarily transfer their property back to the lender and then lease back the house at market rate. The lease period is for up to 12 months, with month-to-month contract extensions after that period. The program is designed for borrowers who ... [Read More]
Fannie Mae has announced a new Deed for Lease™ program. The new program allows borrowers to voluntarily transfer their property back to the lender and then lease back the house at market rate. The lease period is for up to 12 months, with month-to-month contract extensions after that period. The program is designed for borrowers who do not qualify for or have not been able to obtain other loan-workout solutions, such as loan modifications.
To participate in the program, borrowers must live in the home as their primary residence and must be released from any subordinate liens on the property. Tenants of borrowers in this circumstance also may be eligible for leases under the program. Borrowers or tenants interested in a lease must be able to document that the new market rental rate is no more than 31 percent of their gross income.
Homeowners thinking of participating in the Deed for Lease™ program should visit Fannie Mae’s loan look-up Web site at http://loanlookup.fanniemae.com/loanlookup/ to see whether their loan is owned or guaranteed by Fannie. Mortgages backed by the Federal Housing Administration and other government agencies are not eligible for the Deed for Lease ™ program.
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In this market, where homeowners have to compete with the “fire sale” prices of bank owned homes, it more important than ever for homeowners to be realistic about their home’s values. It often is difficult for homeowners to objectively value their homes, which often reflects their sense of personal style. However, by consulting with a ... [Read More]
In this market, where homeowners have to compete with the “fire sale” prices of bank owned homes, it more important than ever for homeowners to be realistic about their home’s values. It often is difficult for homeowners to objectively value their homes, which often reflects their sense of personal style. However, by consulting with a REALTOR®, using online resources, investigating neighborhood trends, and soliciting the opinion of friends, homeowners can arrive at a reasonably accurate appraisal. If they cannot accept the reality of the situation, I recommend that they wait for a more favorable selling climate. On the positive side, they will often more than make up the loss from the savings on their new purchase. It is important to have their agent help them “crunch the numbers” before making the final decision.
If they are having financial difficulties, it is critically important for them to consult with their real estate consultant to get accurate information on all their options and the possible consequences.
