Fannie Mae Gets Into The Home Rental Business
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.
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