Feds Announce Program To Turn Foreclosures Into Rentals

In an effort to put living, paying bodies into homes left vacant following foreclosure, the Federal Housing Finance Agency has announced the beginnings of a program to sell off pools of foreclosed properties to investors who would then rent them out.

The initiative is aimed at the areas hit hardest by foreclosures, where entire blocks go unoccupied because the bank can’t find a buyer.

FHFA is now allowing interested investors to pre-qualify for the program. Eventually, they will be able to invest in pools of foreclosed properties, so long as they agree to rent those homes for a specified number of years.

Explains the agency:

This rental period could provide relief for local housing markets that continue to be depressed by the volume of foreclosed properties, and provide additional rental options to certain markets. Pre-qualification ensures investors will have the financial capacity and operational expertise to manage properties in a way that is conducive to the stabilization of communities hard hit by the housing downturn.

“This is an important step toward increasing private investment in foreclosed properties to maximize value and stabilize communities,” said FHFA Acting Director Edward J. DeMarco. “I am grateful for the collaborative effort by the many stakeholders including investors, nonprofit organizations, and state and local government officials, who have worked together on this Initiative.”

If you’re interested in investing in the pool, you can register at FHFA.gov.