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Posted by Coffee's For Closers on June 13, 2008, 7:24 pm
makbo@pacbell.net says...
> I read an interesting article from the WSJ about homeowners who are
> under water on their mortgage. While their payments are still current
> and their credit record unblemished, they get a decent mortgage on a new
> house, at today's much more reasonable prices, and *then* bail on the
> old house (short sale, foreclosure, whatever).
>
> Lenders are trying to block this by requiring evidence that mortgage and
> tax payments can be made on both properties before granting the loan, so
> if you were legitimately trying to turn you old house into a rental, I
> suppose you would have to have a signed lease agreement in place before
> moving out -- not very practical.
Well, you could move out of the old house, and into a cheap
rental apartment (on a month-to-month lease), while getting set
up with a new tenant in the old house. Then apply for the
mortgage on the new house. Less pressure on all levels, since
you would have more time to shop around.
> I wonder when we are going to see a similar strategy from owners of
> late-model SUV's and other gas-guzzler vehicles. Buy an economical car
> first, then walk away from the old one.
I wonder if auto lenders might start doing something like the
credit card "universal default" idea. Which is when Bank A
(which issued your credit card) notices that you are delinquent
on a card from another bank, and then jacks up your interest
rate.
Plenty of mortgages are already on variable interest rates. So
perhaps auto lenders might start offering the equivalent of an
ARM. With the risk of fine print authorising a risk-based
increase similar to the credit card issuers?
--
Get Credit Where Credit Is Due
http://www.cardreport.com/
Credit Tools, Reference, and Forum
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