After previously announcing that it wouldn’t kick out any tenants of foreclosed properties through the end of January, Fannie Mae has stepped up efforts with the establishment of its so-called National Real Estate Owned (REO) Rental Policy.
Going forward, those renting a Fannie Mae-owned foreclosed property will be offered new month-to-month leases based on market rents for the area with no security deposits, or alternatively, financial assistance should they choose to vacate the property.
The properties will be managed through a real estate broker or property management company while being marketed to potential buyers.
“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, in a release.
“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.”
Eligible renters will be contacted by property management companies to go over their options.
The program should also allow Fannie Mae to offset losses while it seeks to unload its excess inventory of foreclosed homes.
Back in August, Fannie Mae said it planned to open REO sales offices in hard-hit areas of the country like Ft. Lauderdale, Florida and another unknown location in California to manage its growing supply.