Fannie Mae Gets Into The Home Rental Business

[Howard Bell]

Good News for foreclosure victims. Some homeowners will get an option to rent the home that they just lost. Its possible to stay in your home as a renter. Fannie Mae will give borrowers facing foreclosure an option to rent their homes for a year.Foreclosed home owners will be able to sign a one year lease, with possible month to month extensions with Fannie Mae. Good for everybody.Homeowners get a little relief and are able to remain in their homes for a year or more. This will buy them the time they need to regroup. It will also help keep neighborhoods from going missing. Rather than rows of abandoned homes with all the crime and destruction that vandals create.. Neighbors that have not lost their homes will not see more equity loss as squatters and criminals move into vacant homes. The banks are reluctant landlords and they are allowing property to decline.It will keep supply off the market for at least another year and that is good for all the handlers, Fanne Mae because it can put off the expense of a foreclosure, the banks because less supply will protect equity in homes they are off loading and everyone one because it will help stabilize home prices. I dont think we can have a strong recovery without real estate.To qualify, homeowners have to live in the home as the primary residence and prove that they can afford the market rent, which will be established by the management company running the program. In many cases, rents will be less than the mortgage because properties that are now worth far less than they originally paid.The downside is seems to be that homes that might normally have been foreclosed and sold will now remain owned by taxpayers. Homes, according to Dr Shiller have risen faster in the last few months than he has ever seen. Perhaps Fannie will profit a little while doing a good thing for families that must be a little traumatized by it all.And even if prices don't rebound quickly. Fannie Mae gets rental income, avoids foreclosure expenses gets to helps people.Thanks for Readingwww.yourpropertypath.comRelated ArticlesThe Fed and The Housing RecoveryBanks and the Housing RecoveryFHA has New Rules

[Brigitte Jones]

I went to fanniemae.com and printed their article on this to give to a client. I think it may be a way to spread out the inventory and allow the homeowner or tenant additional time to relocate. Revenue is also derived to the investor in this scenario versus simply selling now.

[George Kenner]

I am not so sure that this is a good idea. Why not let the market and the investor correct the market, now the Government is the owner and how long will they do this. This is another move to eliminate Congress and thus the public from expressing their opinion before it is to late. This loss and the cost to absorb the loss is coming from the Tax payer...