Buy and Bail

Advice from Craig Bohall, Mortgage Lender.

Buy and Bail = Buy a new house and Bail (walk) on the one you are currently living in!

or

Bail and Buy = Bail or walk on a home that 1 spouse was obligated on and then buy a new home using only the 2nd spouses credit.


This has become a huge issue in the country as there were rules a few years ago that allowed you to buy a home and not have some things checked out . Not any more. Fannie, Freddie and the Govt have closed every loophole they could find to stop all related tactics.

These situations have become more prevalent with the decline in market values.

Buy and Bail - They are usually at a high risk of occurrence when:

1. A borrower is moving to a new home in the same market and keeping current residence, especially when they owe more on their current home than its current value and they can purchase a similar property or larger size home for less. This risk still exists when a borrower is not purchasing in the same market.

Investors are cracking down hard on mortgage companies that don’t sniff this out ahead of time and there are huge penalties for lenders who loan money to people and then those people bail on another home!

Bail and Buy – These are at a high risk of occurrence when:

1 A non-purchasing spouse (#1)is in default/foreclosure/short sale on the property currently serving as the primary residence of the purchasing spouse (#2).

These transactions also show up when the non-purchasing spouse has had a previous foreclosure/short sale/deed-in-lieu within the last 12 months on any property that our borrower was party to either due to occupancy of the property or by marital knowledge (borrower was married to non-purchasing spouse at the time of event, property was indicated on joint tax returns, etc.)

So just because your spouse is not on this new loan but he/she had a foreclosure/short sale / deed-in-lieu recently does not mean that “nobody will find out” - TRUST ME they find out everything!

Without getting into the 50 new guidelines and rules and ways that information can be gathered on your residence, home, mortgage, history, tax records, IRS files etc……. just pleeeeeeeeeese believe that trying to buy and bail or bail and buy will likely not work because there are thousands of underwriters, guideline writers, govt officials and bank auditors, and govt policy writers who all combined have thought of all the ways you can possibly think of to sneak past the system and they have 20 systems that you don’t even know about.

Don’t do it!


Craig Bohall

Your “Safe Harbor” Lender


480-344-2852 – office

480-374-6946 - e-fax

craig@myazmp.com

www.myazmp.com


5304 E Southern Ave #101

Mesa AZ 85206

NMLS 233903

MB-0904081