Freddie Mac recently launched the “REO Rental Initiative”  that gives qualified tenants and former homeowners the option to lease their foreclosed properties on a month-to-month basis.  In their March 5 press release, the troubled mortgage giant announced it will continue to suspend all eviction actions until April 1, 2009 to ensure there is ample time for current occupants to learn about the options available to them under the new initiative.

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability the nation’s residential mortgage markets. Supporting communities across the nation by providing mortgage capital to lenders,  Freddie Mac has made home ownership possible for one in six homebuyers and more than five million renters over the last 40 years.

According to the press release:

“Freddie Mac’s REO Rental Initiative can help ease a foreclosure’s impact by giving renters and former owners more time to determine what options are best for them and their families. At the same time, the REO Rental Initiative helps stabilize property values and local communities by keeping homes occupied and less vulnerable to vandalism,” said Ingrid Beckles, Senior Vice President, Default Asset Management at Freddie Mac.

In order to be eligible for the month-to-month lease program, the tenant or former owner must reside on the property and provide proof that they have income to pay the rental fees as established by a national property management company selected by Freddie Mac. The home must be in safe, habitable condition and meet all local codes for rental properties to qualify for the REO Rental Initiative. In addition, HomeSteps– Freddie Mac’s national real estate unit– will be allowed to show the home to potential buyers during the rental period, as the qualifying homes will also be marketed for sale.

Property management firms have already begun the process of contacting occupants of foreclosed properties to assess their interest in staying in the home and their eligibility for the month-to-month lease program. Occupants will be contacted only after the foreclosure gives Freddie Mac the legal authority to offer a lease. If the occupant is not interested in the lease program, Freddie Mac representatives will continue the existing practice of offering relocation assistance and presenting available workout options with owner-occupants after Freddie Mac gains title to the property through foreclosure.

For more details regarding the initiative, visit the Freddie Mac website at http://www.freddiemac.com.

Related posts:

1. Fannie Mae Discontinues Eviction of Tenants in Foreclosed Homes The Wall Street Journal reported on Sunday that Fannie Mae...
2. FAQs on the “Making Homes Affordable” Refinancing Initiative Are you one of the many Americans becoming overwhelmed by...
3. Home Mortgage Rates at 4.5%– Can It Happen? If you are one of the few people left that...
4. Top Five Reasons to Buy a Home in 2009 The world is in recession, various segments of the economy...
5. Details on the Proposed $15,000 Home Buyer Tax Credit Potential home buyers all around the country, myself included, are...