Facing foreclosure from Bank of America?
BofA has realized they have a problem on their hands: you can foreclose on millions of delinquent homes all you want, but getting rid of them before they fall apart due to disrepair isn’t as easy.
If you’re sitting on thousands of properties it takes a lot of potential upkeep to keep damage through nature, vandalism, or just general maintenance from ruining the home. It takes time, money, and effort to air the home out, keep mold from growing, and to keep the yard trimmed.
To combat this problem, Bank of America is running a pilot program in Arizona that will let homeowners facing inevitable foreclosure to hand over their properties to the bank. In return they are forgiven the mortgage debt and allowed to rent the property back from the bank for up to three years. The bank gets the bad mortgage taken care of, gets to keep the asset, and generates a little bit of return in the monthly rent back to the bank.
Will this solve the foreclosure problem for the big banks? Probably not, but it is a step in the right direction.