Falling behind on your Bank of America mortgage? Well, what would you say if the bank offered to take your house, but let you rent it for a while? That's the idea behind a new "Mortgage to Lease" pilot program that BofA is rolling out in select markets in Arizona, Nevada, and New York. Participants will hand the title of their home over to the bank, which will forgive their outstanding debt and lease it to them for up to three years at or below market rates, the AP explains.
Rent payments will be lower than what customers were paying for their mortgages, and the new tenants will also be freed from paying property taxes or homeowners insurance, the bank pointed out. The pilot, which will include less than 1,000 BofA customers, "will help determine whether conversion from homeownership to rental is something our customers, the community, and investors will support," an executive said. If it succeeds, the bank thinks it will help stabilize housing prices by keeping some distressed homes off the market. The move comes on the heels of reports that Wall Street is increasingly interested in real estate.