Fannie Mae Preventing Evictions of Foreclosure Victims

In an effort to address enduring foreclosure crisis, Fannie Mae, which is being run by the government, is planning to have new rentals for tenants who live in multi-family and single foreclosed homes which belonged to them.

The rents may be for a short period of time only as they continue to advertise the homes as for sale. Foreclosures continue to rise and the Mortgage Bankers Association and economists expect it to increase, along with the rate of unemployment.

According to Fannie Mae Spokesman Brian Faith, they own an estimate of 67,500 foreclosed homes. 4,000 occupants are currently staying in properties considered as foreclosed.

Fannie Mae also previously stated they will not force occupants to leave the house until the end of the year.

In spite of it, the Wall Street Journal has reported that Fannie Mae was pressured because of a legal assistance group which threatened them for a legal action due to current expulsions in the state of Connecticut.

On the other hand, they will make certain that the holiday suspension on the would-be evictions is being done while waiting for the latest policy to take effect come January.

According to Faith, for the occupants who will not opt for a leasing, another option that they offer is giving financial assistance for some changes or adjustments in terms of living in a new house.

Due to the policy, an estimate of 7,000 up to 10,000 households was given an opportunity to remain in their house.

Freddie Mac, which is another mortgage financing company, is also being run by the government since September and is currently planning on programs similar to Fannie Mae’s. Company Spokesman Brad German said it is expected to be done early next year.

“Streamlined Modification Program” were also created by both companies to help default borrowers and at the same time to avoid foreclosures.