This program should help some of the homeowners - any help is better than nothing. Being able to stay in your home for a year or so can be very helpful.
Fannie Mae announced an innovative program to help keep families from falling into foreclosure. The program, called Deed For Lease (D4L) allows struggling homeowners who are unable to qualify for a loan modification to essentially hand their keys over to Fannie Mae, and then rent back their house at current market rental rates.
Here are the Fannie Mae Deed for Lease Program Rules:
1. The mortgage loan is a first lien mortgage loan secured by a one- to four-unit property. All property types are eligible. Second lien mortgage loans are not eligible.
2. The mortgage loan is not guaranteed or insured by a federal agency (FHA, HUD, VA, or Rural Development).
3. The borrower resides in the property as a primary residence or has leased the property to a tenant who uses the property as a primary residence. Second homes or vacation homes are not eligible.
4. At least three payments have been made since origination or since the last modification.
5. At the time of the referral to Fannie Mae for the D4L, the borrower is not 12 or more payments past due on the mortgage loan.
6. The borrower is not involved in an active bankruptcy proceeding and is not a party to litigation involving the subject property or the mortgage loan.
7. Marketable title is able to be conveyed (a title insurance policy is required).
8. If there are subordinate liens secured against the subject, lien releases can be obtained.
9. The occupant of the property (i.e., the borrower or the borrower’s tenant) has verifiable income. Occupants with no source of income are not eligible.
There is additional Eligibility Criteria to be Determined by Fannie Mae, which includes Deed for Lease Property Eligibility as well as Deed for Lease Occupant Eligibility. To read the additional criteria, logon to ThinkGlink.com.