2008 Freddie Mac approved more than 87,485 workouts -NOW you can Rent Back Your Home-Whats next
FREDDIE MAC EXTENDS EVICTION SUSPENSION UNTIL MARCH, LAUNCHES RENTAL OPTION FOR FORECLOSED BORROWERS, TENANTS
Freddie Mac announced today that it would permit homeowners who have lost their home to foreclosure to actually turn around and rent them back from Freddie Mac. “Keeping foreclosed properties occupied and in better repair will support local property values and promote a faster recovery in the housing market,” said Freddie Mac CEO David Moffett. And in a change of course from the lending practices of the past, Freddie Mac will request documentation from the new tenant (former borrower) to prove that they have enough income to afford the rent.
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McLean, VA – Freddie Mac (NYSE: FRE) today announced it is extending its suspension of evictions triggered by foreclosures on single family properties with Freddie Mac-owned mortgages through February 28, 2009. Freddie Mac is simultaneously launching a new strategy to offer qualified owner-occupants and tenants leases so they can rent the properties on a month-to-month basis after foreclosure.
“First and foremost, Freddie Mac’s REO Rental Option is intended to help cushion the impact of foreclosure on families who own or rent homes with Freddie Mac-owned mortgages,” said David M. Moffett, Chief Executive Officer of Freddie Mac. “At the same time keeping foreclosed properties occupied and in better repair will support local property values and promote a faster recovery in the housing market.”
Under the REO Rental Option, leases will be offered to current renters on a month-to-month basis at market rents or the rent amount they were paying prior to foreclosure, whichever is less. The rent for former owner-occupants will be the market rent, which will determined by the property management firm Freddie Mac contracted to manage the program.
To qualify, current tenants and former owner-occupants must be able to demonstrate they have adequate income to pay the monthly rental amount. The home must also meet applicable building codes, or can be affordably brought into compliance, to be eligible.
Freddie Mac will also explore loan modification options that may enable owner-occupants to retain ownership of their homes by reinstating their mortgage with modified terms.
“In about half of all foreclosure sales there is no conversation between the borrower and the mortgage servicer about workouts. Before starting the eviction process, we want to ensure there is one last effort to achieve a workout,” explained Ingrid Beckles, Senior Vice President of Default Asset Management at Freddie Mac.
In 2008 Freddie Mac approved more than 87,485 workouts, enabling three out of five of its seriously delinquent borrowers to avoid foreclosure.
Freddie Mac gives lenders servicing its mortgages broad authority to help troubled borrowers before they miss a payment through forbearance as well as provide permanent rate reductions, mortgage term extensions or other modifications to borrowers who are already delinquent. Freddie Mac workout options include the Streamlined Modification Program developed with Fannie Mae, the Federal Housing Finance Agency (FHFA), HOPE Now and 27 mortgage servicers to expedite loan modifications for eligible borrowers who have missed three or more mortgage payments. (For more about Freddie Mac workout options, see freddiemac.com/avoiding_foreclosure.)
Posts Tagged ‘Tampa’
Loan Modifications, Cash for keys and Renting your Home Back from the Bank after a Bankrutpcy
Monday, February 2nd, 2009Tampa Bankruptcy – House Bill on Modification and Stimulus Package
Wednesday, January 28th, 2009Chapter 13 bankrupcy reform will go to the House as a stand alone proposal, being separated from the stimulus bill that our government wants to give us next week.
This reform would allow bankruptcy courts to change the terms of mortgages on homes, so that the homeowner could get a fixed rate, stretch the total term to 40 years, and lower the balance to the value of the house.
Of course, being that this would cost the taxpayers nothing, no opportunity for our trusted servants to pass out taxpayer money to their own benefit, it is now taking a back seat to the stimulus bill, which will be the largest single disbursement of our money, ever.
As the foreclosure crisis continues and gets worse, not better, this relief is needed now more than when we started blogging for it many months ago.
National Association of Consumer Bankruptcy Attorneys report on the status of the bill follows:
“the House of Representatives will vote next week on the economic recovery plan that President Obama is working with Congress on getting enacted. We learned late today that the chapter 13 mortgage modification bill will not be included in that package. The good news is that President Obama and House and Senate Democratic leaders are firmly committed to getting this legislation passed into law as soon as possible and will be looking for appropriate vehicles to attach it to.
In the meantime, the House Judiciary Committee will mark up H.R. 200, the chapter 13 mortgage modification bill on Tuesday.”
Your house may not be in foreclosure, but its value is being lowered by all the homes in your neighborhood already there.
This reform costs us nothing, compared to the hundreds of billions already thrown to the banks largely responsible for creating the crisis.
Let your representatives, especially in the Senate, know how you feel.
