Buy and Bail

A NEW TWIST ON WALKING AWAY FROM A MORTGAGE

In the hardest hit housing markets, some borrowers with a mortgage worth much more than their home are buying a second home before walking away from their primary residence - a strategy known as Buy and Bail.

How It Works: Borrowers can qualify for a second loan by proposing to rent out their existing residence to cover the second mortgage payments. Once they are approved for a loan, they walk away from the existing home instead of renting it out.

Consequences: Homeowners with a foreclosure will take a big hit to their credit and won't be able to purchase a home for five years under new Fannie Mae guidelines. Also, lenders might sue for personal assets and for fraud.

Lenders Respond: Fannie Mae says that later this month, it will release tougher loan qualification guidelines designed to ensure that individuals who plan to rent their first home after buying a second home show proof that they can make both payments.

Real Estate Open Networkers

Baghdad Real Estate Sizzling Hot

Are you looking to flip a property for profit? The U.S. real estate market may not look so hot, but the Baghdad real estate market is sizzling hot.

There is no mortgage crisis in Baghdad because there are no mortgages. People buy and sell real estate for cash and lots of it these days. The market prices continue to rise like Florida, Las Vegas or California did a few years ago.

Because there is almost no construction in Baghdad since before the war, real estate is limited, causing the market to climb. The decrease in violence of late has added to the boom in prices.


Real Estate Open Networkers