Renters Feel the Pains of Home Loss During Foreclosure Crisis
admin on January 5th, 2009
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The mortgage meltdown has affected more than just homeowners as renters are forced out of foreclosed homes. The record number of foreclosures throughout the nation has caused a drag on the rental community as well. Statistics show that 40 percent of
the nation’s renters lease a single family home from private homeowners. While most homeowners-turned-landlords, conduct a background check on prospective tenants, it is difficult to find information on a homeowner’s history. Oftentimes tenants are not sure of the owners and only qualify whether to move into a home by the home’s appearance, rental amount and neighborhood and as a result thousands of tenants are losing their rented homes to foreclosures.
Mortgage giant Fannie Mae has initiated a program to aid these displaced renters by allowing them to sign a new lease with Fannie Mae or provide financial relocation assistance. Freddie Mac is set to unveil a similar service shortly. However, only tenants renting a home that is mortgaged by Fannie Mae or Freddie Mac will be able utilize the new program. Some states have begun to implement plans to assist the renters facing eviction from a foreclosed home. Municipalities and hosuing authorities are also turning displaced tenants to housing non-profit groups for counseling and assistance in homeowner background checks before signing a new rental lease.
