House Passes Foreclosure Rental Bill
By DIANA GOLOBAY
July 30, 2009 1:25 PM CST

"The House of Representatives this week passed a bill that would authorize federally-insured depository institutions and banks to lease real estate-owned homes for a limited period of time — up to five years."

http://www.housingwire.com/2009/07/30/house-passes-foreclosure-rental-bill/

Between this, Barney Frank threatening to stop foreclosures, and the IRS practically absolving foreclosed homeowners of their tax liabilities, I wonder what the ultimate outcome will be when the dust settles? If it ever does.

I don't even want to ask, "what next" because I don't think I want to know.

This whole country is upside down in so many ways and, while I believe there are many homeowners whose situation was unavoidable, I believe that there are SO many more that took a major vacation from their responsibilities and obligations who appear to be getting off nearly scot-free.

If the bottom falls out of the preservation industry because there are no longer homes to be serviced, I could care less. I can always find a new business to own.

What concerns me most is the seemingly total disregard for the messes people have made that have affected the entire country and how everyone else is forced to live today, barely scraping by while others live rent-free or have their mortgages reduced by the courts so they can file bankruptcy and keep their homes.

Sorry for the rant. I'm just sooooooooooo disgusted.

Linda

Settle down. Call the White house and ask to sit down with the Predident and have a beer.

LOL, REO. Excellent advice. I just might do that. In fact, I might even bring the beer.

Linda

It's just a different spin on an old story. There's always been (and will always be) a contingent that "works" the system. All the while the rest of us pay to keep that system in place. It does seem to have escalated to a whole new scale lately, but maybe it's just the place it's taken in my consciousness due to the industry I'm in.

My philosophical question is, what would a revolution look like by today's standards? It seems like there are plenty that hate what's going on, but the only way to fight it is to write your congressman? That doesn't seem powerful enough given the magnitude of the atrocities.

Forgive my Jerry Maguire moment.

Oh. And in my book, it's better to plop a case up on the table rather than have the neat as a pin server bring the beer over on a silver tray...complete with towel draped over his arm. I do like that they showed some conservation by all sharing from one bowl of nuts rather than each getting their own. That had to be good for the economy. And healthcare. Probably race relations too.

Where they grown in America nuts? I know the cop was - lol

True, true, forgiven, and true, H&B.

I prefer the self-serve method, too, unless the server is tall, dark, and handsome. Doesn't have to be rich but he'd best have a great sense of humor!

Why do I get the feeling I'm just a peanut in a bowl of mixed nuts?

Linda

Hmmm... So here is my question.

Is this step being taken to help limit the amount of active properties in an areas inventory and help bolster up housing prices again?>

J~

Is it gonna help the economy? Let them keep trying.

The think tank, the Center for Economic and Policy Research (CEPR), called for passage of a right to rent law to allow all homeowners the option to remain in their homes after foreclosure.

“While this [bill] may allow some number of homeowners to stay in their homes as renters, it is unlikely to benefit the vast majority of homeowners who are facing foreclosure, since the decision to allow homeowners to become long-term renters will be left with the bank,” the CEPR said in its statement. “If Congress does want to give foreclosed homeowners the option to stay in their homes as renters, it will be necessary to pass legislation that explicitly gives them this right.”

hmmmm.... now let's see. The homeowner that's been foreclosed hasn't made a payment for about a yr (sometimes longer). Now the bank is going to be forced to allow them to be tenants in the property for 5 yrs. So when they don't make their rent payment, I guess some new legislation will pass that says they can't evict them for at least a year. Oh, and I guess the banks will now be responsible to take care of all the deferred maintenance for the tenants since they will now be Landlords and will be required to adhere to Landlord/Tenant regulations. I can see it now.... my furnace isn't working, my A/C isn't working. I've become ill from a mold condition. I think I'll sue the bank for not remediating the mold condition. Oh, and let's be sure to include the gardner and weekly pool service in the rent!!!

This is going to be good.... can't wait to see all the complications that will arise from this... but I'm sure it will help the economy!!!

This is the same old dog and pony show Barney pig Franks has been spewing out for the last two years. Nothing I know of currently prohibits a bank from renting a property THEY OWN. Last time I checked, the banks were paying thousands of dollars to get tenants to leave.

If they pass legilation that "requires" the bank to let the homeowner become a tenant, the Relocation Incentives are going to become HUGE since the homeowner would now have the right to stay for 5 yrs! Yes, they are already paying big sums to relocate the foreclosed homeowner, but that's nothing compared to what's to come if this new legislation should pass. And you know that alot of the homeowners are going to default on the rent. Now the banks will absorb excessive legal fees for tenant eviction process, not to mention additional losses for lost rents. What a GREAT way to force more banks into insolvency!

Excellent points, Pacific Breeze. Those were some of the things on my mind, too, and why I'm so disturbed by this.

We're already seeing a huge change this year in the property preservation industry. We have more occupied properties on initial inspections and squatters than I've ever seen. Last year was flat out busy, this year is just plain weird on top of being busy and there's more to keep track of.

What we're experiencing now is just the tip of the iceberg, in my opinion.

Linda

Unless I am reading it wrong it allows the banks to rent them it does not require them to do so.

In my community the housing crisis is a lack of inventory.

Read it again Grampa...
“If Congress does want to give foreclosed homeowners the option to stay in their homes as renters, it will be necessary to pass legislation that explicitly gives them this right.”

I don't think the banks want the legal problems of becoming landlords. I think its one of the reasons they don't collect rent on tenant-occupied properties.

Who is going to decide how much the monthly rent should be?

Probably the agent. Or the bank. Most likely the bank.

They won't have a choice if they forclose on a tenant occupied property with a valid arms lenght lease (at a fair market rent) in place. The law that went into effect May 20 allows tenants to stay 90 days minimum or the length of the lease which ever is longer so long as they continue to pay rent to the lender. That is why companies like Tenant Access are ramping up to manage the properties they expect to have to handle and one reason for the delay in a lot of foreclosures.

Let's just hope that they ramp up fast because I sure as hell don't want to become a property manager for the banks. That's a whole different sector of Real Estate. If the disgruntled homeowner that lost their home becomes the tenant, then I imagine they may become a PITA tenant that we will have to deal with! I can see it now...
No thank you!

This is going to get crazy. If banks don't want to do repairs, etc. to get their money out of a house and sell as is, I don't see banks getting excited about putting a house in inhabitable condition to rent it. If the owner stays, I'm sure they will want deferred maintenance done and have a laundry list of items they would now like repaired by the the new owner ( bank ) and someone to come mow the lawn that is no longer their problem. Who is going to do this property management? Is that the new "cheese"? There are a lot of RE companies that don't do property management and don't want to so even if an agent decides to go down this path it could mean an office change. ....but wait!!!! This doesn't apply because they were announcing the recession is over on the news this week! WHEW!!!

This is not about the homeowner becoming a tenant at this point the law passed in May is only for valid tenants with a valid lease. That is unless they change the law to allow for renting to a former homeowner.

It was my understanding that only Freddie and Fannie had property management departments in place to handle the foreclosure of their properties that are tenant-occupied.

Does anyone know where I can read about the law that took place in May?

That would be Senate Bill 896.