U.S. Senator Proposes Renting Out Foreclosures

[The Straight Story]

U.S. Senator Proposes Renting Out Foreclosures

There’s an old Lily Tomlin joke where she says, “Wouldn’t it be great if all the people in New York who talk to themselves were paired off, so it looks like they’re talking to each other?”

In a similar spirit, apparently, Senator Jack Reed (D-R.I.) has proposed a solution to America’s foreclosure problem (i.e. there are too many of them) and its rental problem (i.e. prices are too high). We should, Reed says, simply put renters in some of the available foreclosed homes.

Housing Wire’s Jon Prior notes that Reed sent a letter to the acting director of the Federal Housing Finance Agency detailing his plan to generate revenue from the inventory of foreclosed homes. Currently Fannie Mae, a quasi-governmental agency that backs a large portion of the mortgages in the U.S., is stuck with more than 100,000 repossessed properties.

So why not get into the landlord business? Or to quote Reed: “The number of vacant foreclosed homes waiting to be sold at depressed prices is increasing at the same time that the demand for rental properties is increasing.”



Read more: http://moneyland.time.com/2011/08/09/senator-proposes-renting-out-foreclosures/#ixzz1UXlrYmbd

[EstimatedProphet]

1. That's what the goal was all along

People own house

Bank forecloses on house

Bank now owns house

Bank rents house back to people

[Proud Liberal Dem]

2. Or what about allowing people to "rent" their homes at a lower price

if they can't afford to "own" them? :shrug: A "rent-to-own" arrangement? I don't know if that's feasible or just crazy but might as well put the homes to good use.

[Modern_Matthew]

3. An executive order to freeze all foreclosures for at least a decade sounds better. nt

[Travis_0004]

7. And how would that work?

If you freeze foreclosures, whats to stop a lot of people from just not paying their mortgage.

[Romulox]

4. Um, no. Let the toxic real estate clear the market at true market prices. (that means MUCH lower)

THAT would help poor people out more than this hair-brained scheme.

[NightWatcher]

5. So banks or the government can profit from kicking people out of their homes?

And what would this do to the rental market? Undercut the landlords who already own property?

This is a horrible idea that screams of malfeasance and corruption waiting to happen.

Try to keep people in their homes, don't try to profit from disaster and ruin the rental market while you're at it.

[slackmaster]

6. That might make sense in an area where there is a shortage of available rentals

In places where rentals are abundant, it doesn't make sense.

I don't see a legitimate issue for the federal government here.

[rsmith6621]

8. I Would Not Rent These Simply Without....

........signing a one year lease...no way would I rent one of these homes and then have to move out a two months later.


Yes I think the bank should be forced to sell these at the real value.

[The Straight Story]

9. Kicking for the night crew (nt)