New Mortgage Info Learned for Short Sellers

I have two clients currently considering leasing and/or selling their property and buying a home more suitable to their specific needs. In speaking to my mortgage broker, Mr. Rob Scheuing of Sherwood Mortgage, he informed me of a recent new mortgage criteria called the "Buy and Bail" rule. It effects one of the two scenarios negatively unfortunately. The rule states that for a buyer to use the income from their rental property they own in order to help them qualify for their new loan, they have to have at least 30% equity in that property. The point of this rule is that they don't want owners who are not behind on their payments going out and buying something new and then just letting their old property that they are underwater on go to a short sale or foreclosure. Makes sense right. The only way to get around that is to show that the property has been leased for the previous two years. Please keep this in mind, and talk to a qualified lender, should you be considering the aforementioned strategy. I would definitely recommend Mr. Scheuing (pronounced Shoe-ing) to anyone with the utmost confidence, as he has closed about two dozen transactions for my clients. You can contact him for all your lending questions on Sherwood Mtg's website or call him directly @ 805.496.2512.