Citicorp to provide free housing, what??

Got a mortgage with Citicorp?  They may let you live in the house for free!

Citigroup, for instance, plans to announce a pilot program on Thursday that would allow delinquent borrowers who don’t qualify for or decline mortgage relief the opportunity to stay in their homes without making payments for up to six months before turning over the keys, in return for keeping the property in good condition. The bank estimates that up to 20,000 borrowers in Texas, Florida, Illinois, Michigan, New Jersey and Ohio could be eligible.

The program is just the latest amid a growing acknowledgment that foreclosure prevention efforts will fail to reach millions of borrowers over the next few years.

“This is a graceful way to move on with their lives instead of being foreclosed on and being evicted from their homes,” said Sanjiv Das, chief executive of CitiMortgage.

The Citigroup plan attempts to address some common industry complaints, including borrowers who leave their homes in disarray after foreclosure, requiring lenders to spend thousands of dollars fixing up the property before putting it on the market. Also, homeowners who owe far more than their homes are worth increasingly are choosing to “strategically default,” even though they can afford to pay their mortgage. The new program gives CitiMortgage more control over when distressed homes are put up for sale, bypassing clogged courthouses that have slowed the foreclosure process in many parts of the country.

By avoiding a glut of foreclosures that could hit the housing market within the next 16 to 18 months, the program – if it is replicated throughout the industry – could help prevent another dip in home prices, Das said.
It would be a more orderly process “than if all of the foreclosed properties came crashing at some point in the cycle,” he said.

Follow the Jupiter/Tequesta market at or on my You Tube channel: