Under a program announced on Thursday (10/5/09) by Fannie Mae called Deed for Lease, qualified borrowers would be able to remain in their residences by signing a lease voluntarily transferring the property deed back to the lender. The new program is designed for borrowers who do not qualify for or have not been able to sustain other loan-workout solutions, such as a modification. Under Deed for Lease, borrowers transfer their property to the lender by completing a deed in lieu of foreclosure, and then lease back the house at a market rate.
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 may also 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% of their gross income.
Naturally, there is a small catch - Pets. “Certain pets may pose a liability threat to the tenant and the landlord,” Fannie Mae said. “For this reason we may require tenants with pets to secure renters insurance, which includes liability coverage for pets and names Fannie Mae as an additional insured.”
Does that include goldfish?
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