UNDATED (AP) - Citigroup will try something new to keep struggling homeowners out of foreclosure: turn them into renters.
CitiMortgage has announced the program, painting it as a way to help homeowners stuck in houses they can't afford. The New York-based bank, however, won't manage the program. Instead, it is handing the reigns to an investment firm. The bank just sold a $158 million mortgage portfolio to investment firms that will manage the program.
Carrington Capital Management and its sister mortgage company will comb the portfolio for eligible homeowners - though they're homeowners in name only, since they are still paying for their houses. Carrington is looking for people who owe more on their house than it's worth, but also seem to have the means to keep making monthly payments.
They also must live in the house, meaning it can't be a vacation home or investment property. And they have to be at least four months late on payments.
Carrington says the pilot program will help about 500 homeowners in six markets that have been hit especially hard by the plunge in housing prices: Arizona, California, Texas, Florida, Nevada and Georgia. It says it will begin contacting eligible homeowners this month.
First Coast News