Freddie Mac to Rent REO Properties

Freddie Mac has launched its new REO Rental Initiative giving qualified tenants and former owners the option to lease their recently foreclosed properties on a month-to-month basis. The initiative will be managed by HomeSteps, Freddie Mac's national real estate unit, and implemented through several national property management firms. Freddie Mac will continue to suspend all eviction actions until April 1, 2009. Starting today the property management firms will begin the process of contacting occupants to determine their interest in staying in the home and their eligibility for a month-to-month lease. To qualify for a lease, the tenant or former owner must occupy the property and show they have adequate income to pay the monthly rental amount established by the property management company based on market rents for the area where the home is located. Occupants must agree to allow HomeSteps to show the home to potential buyers as it will be marketed for sale during the lease period. If an occupant does not wish to lease the property, Freddie Mac will continue its current practice of offering relocation assistance. In addition, Freddie Mac will also explore available workout options with owner-occupants after Freddie Mac gains title to the property through foreclosure. "The Rental Initiative helps stabilize property values and local communities by keeping homes occupied and less vulnerable to vandalism," said Ingrid Beckles, senior vice president, default asset management at Freddie Mac.