Qualified tenants and homeowners now have the option to rent out properties which they formerly owned but which were recently foreclosed under the REO Rental Initiative of the Freddie Mac. Under the Initiative which will be managed by HomeSteps, the lease will be made on a month-to-month basis. Aside from this, homeowners have one more consolation these days since Freddie Mac said it will continue to suspend all evictions actions until April 1, 2009. This will give the homeowners enough time to look for alternatives including the option to avail of the Initiative.
The new REO Rental Initiative is expected to help ease the impact of foreclosure by providing more time for renters and owners to determine which option they should take. It is also expected to stabilize the values of the properties as well as the well being of the local communities by keeping homes occupied thereby reducing the risk of vandalism and squatting.
The tenant of former owner should however qualify under the Initiative by showing that they have adequate income to pay the monthly rental. On the other hand, they should also agree to open up the house for potential buyers.