The New York Times reports
FOR homeowners who have been buffeted about by the foreclosure process, the suggestion that they willingly hand their deed to the lender and rent the home instead may only add insult to injury.
But such an alternative to foreclosure — variously called “deed for lease” or “mortgage to lease” — is an option for a select few. Fannie Mae introduced a rent-back program in 2009, and this year, both Bank of America and CitiMortgage announced that they would try a similar approach in a handful of markets.
The programs are basically an extension of what’s known as “deed in lieu of foreclosure.” In this process, the lender agrees not to foreclose if the homeowners simply hand over the deed to their property.An interesting idea and in some markets it might work very well if homeowners can rebuild their income.
There is a scam similar to this legitimate program. In the scam, the "buyer" or "investor" gives you money for your home, usually enough to pay off your mortgage, and then agrees to rent you the house back at $X. The problem is that the monthly payment is too steep for the former owner to maintain payments.
In the meantime, the investor has borrowed against the home, ceases to make payments and the former owner is on the street.
For your next title order or
if you have questions about what you see here, contact
Stephen M. Flatow, Esq.
Vested Land Services LLC
165 Passaic Avenue, Suite 101
Fairfield, NJ 07004
Tel 973-808-6130 - Fax 973-227-0645
E-mail sflatow AT vested.com
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