Tuesday, January 19, 2010

Fannie Mae Announces National REO Rental Policy

January 2009

Foreclosures continue to rise and Title Insurance Companies work with lenders like Fannie Mae to process REO transactions. This change in Rental Policy will better accomodate innocent victims of the foreclosure process and allow for property to stay in good condition as transactions are closed through the title and settlement service process with buyers of the properties.

Fannie Mae will establish a new National Real Estate Owned (REO) Rental Policy that will allow qualified renters in Fannie Mae-owned foreclosed properties to stay in their homes. The company currently has an eviction suspension in place through the end of January, which will allow for the new policy to be fully operational prior to the suspension concluding.

"Renters in foreclosed properties have often been a casualty of the foreclosure crisis the country is facing," said Michael Williams, chief operating officer of Fannie Mae. "This policy will allow qualified renters to remain in Fannie Mae-owned properties should they choose to do so, mitigate the disruption of personal lives that foreclosures can cause, and help bring a measure of stability to communities impacted by high foreclosure rates."

The new policy applies to renters occupying foreclosed properties at the time Fannie Mae acquires the property. Renters occupying any type of single-family property will be eligible including residents of two- to four-unit properties, condos, co-ops, single-family detached homes and manufactured housing. Eligible renters will be offered a new month-to-month lease with Fannie Mae or financial assistance for their transition to new housing should they choose to vacate the property. The properties must meet state laws and local code requirements for a rental property.

Information is courtesy of Derrick LeBlanc of Chicago Title