Mortgage to Lease? Bank of America Rolls Out New Program to Avoid Foreclosure

by Isaac Benmergui, Esq on April 8, 2012

No one has to tell South Florida homeowners facing foreclosure about the severity of the real estate housing bust. Homeowners underwater with their mortgages may have new hope; however, in avoiding foreclosure if Bank of America owns their South Florida mortgage. In a new foreclosure prevention program called “mortgage-to-lease,” Bank of America offers customers who have already sought and tried loan modifications, short sales, deeds-in-lieu and forbearance on mortgage payments, a way to deed the property back to the bank in exchange, receive a long-term lease, at or below current market rate for a rental unit. The homeowner may or may not have the option of buying the home back at the end of the lease. Those details have yet to be cemented.

The Washington Post reports that some homeowner advocate groups have responded positively to the mortgage to lease initiative.

After an initial trial run with 1,000 homeowners in California, Nevada, and Arizona, expect the program to be broadened into the rest of the states. It is anticipated that Freddie Mac and Fannie Mae, the nation’s largest players in the home mortgage market, will be watching Bank of American’s program closely.

One catch in the success of the mortgage to lease program could be that Bank of America plans to sell the rental homes to investment groups who will then become the landlords.

If you’re a homeowner facing foreclosure and want to hold on to your home, the law offices of Isaac Benmergui can help you with your legal real estate needs; call 780-800-2510 or email Isaac@benmerguilaw.com for more information or to set up an appointment today.

 

 

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