A disturbing product of the foreclosure epidemic is the eviction of renters who’ve done nothing wrong and have nothing to do with the problems that spurred the foreclosure action.
Generally, when banks foreclose on properties, they don’t want the liability of renters.
The renters are often evicted because banks don't want the hassle of becoming landlords and they want to sell the properties to recoup losses.
Fannie Mae Offers Help
The Consumerist recently reported some good news for renters.
Fannie Mae has launched a new program that will allow renters in good standing to remain in their foreclosed properties.
Jason Allnutt, vice president of Fannie Mae, commented on the unfortunate renter situation to Marketplace Money:
"You have a family who is networked into the neighborhood, into the school system, into the job market, and it's very, very difficult to be wrenched out of that network and put on the street to look for a new place to live."
Too bad Fannie Mae only owns approximately 10 percent of all foreclosed properties.
So, although Fannie Mae's new policy will help some, the vast majority of renters still will be evicted if their residences are foreclosed upon.
If renters have questions about whether their building is owned by Fannie Mae, The Consumerist recommends calling the attorney whose name appears on the foreclosure notice.
That attorney should be able to advise renters on which lender owns the property.
Allnut said he’ll make sure attorneys are prepared to help renters obtain a new lease if they live in foreclosed Fannie Mae properties.
--Did You Know: Chapter 13 Bankruptcy can Stop Foreclosure in Some Cases
Tags: chapter 13 bankruptcy, foreclosure, renters
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