Foreclosure Help for Homeowners and Renters
Posted January 13, 2009
Welcome to 2009 and the first blog post of the year. There are lots of new and exciting events going on in the world of housing and mortgage so let’s get right to it.
Fannie and Freddie to the rescue again, this time giving homeowners and renters some additional time regarding foreclosures by extending a moratorium on foreclosure suspensions for another three weeks. This extension provides a directive to mortgage servicers to now postpone any foreclosure or eviction proceedings through January 31, 2009.
The extension is good news for a couple of reasons – the first reason is that it gives homeowners more time to enroll in these streamlined modification programs, thereby hopefully reducing the number of people who have the foreclosure process started against them. It also helps communities maintain a more normal housing balance in that typically an area with higher foreclosure activity has additional downward pressure on home values – thereby creating less wealth through equity reduction. Areas perceived as less desirable through that downward pressure have fewer buyers which means greater vacancies.
In the past, when landlords have faced foreclosure, their tenants would often get the boot even if their leases had not yet expired. The positive for renters now is that Fannie has created a new policy called the National REO Rental Policy - which simply allows renters to stay in homes through the length of their original lease contract as long as they continue to maintain their payments.
Foreclosures here in NC have certainly impacted many lives, and so it’s important that as an industry we’re doing everything we can to help minimize the number of foreclosures, not just here in NC but nationally as well.
A reminder to anyone facing the foreclosure process – the worst thing you can do is ignore the problem. Remember that Lenders don’t want to become landlords of empty properties, they want to keep you in the home – so reach out and discuss your situation with your lender/servicer and hopefully you can put together a resolution before the foreclosure process begins…
Jeremy M. Salemson
Corporate Investors Mortgage Group, Inc.