Beginning on August 1st, a new underwriting rule goes into effect to halt the "buy-and-bail".
Fannie and Freddie underwriting guidelines will require that borrowers applying for a mortgage to purchase a property, and who already own another, must verify that they have at least 30% equity in the old property - or they can't get a loan.
Countrywide has already instituted the new guideline, and is also applying it towards FHA applicants as well. This came into play on the Arthur deal, and as a result, we don't have a winner yet - but stay tuned, tomorrow is the day! In an interesting twist, Countrywide is applying the rule towards FHA loans, and Bank of America is not - at least, not yet.