Source: CNBC.com (Thanks Paul Barrow!)
“Yep, thanks to a new program announced by the nation’s largest owner of home loans, Fannie Mae, troubled borrowers can sign over the deed of their homes and rent back for the current market rate.
It’s called “Deed for Lease,” and Fannie VP Jay Ryan calls it “an additional option for qualifying homeowners who are facing foreclosure and are not eligible for modifications.”
It’s a deed in lieu of foreclosure is what it is.
It’s only for owner-occupants, and they must be released from all second liens, which by the way is easier said than done these days, as home equity lenders are taking a tougher stand on getting something in all the distressed deal-making.
Borrowers have to prove that the new market rental rate is no more than 31 percent of their gross income; that of course so we make sure they actually pay the rent.”