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About Foreclosed Homes, Green Tax Credit and REO Rental

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By : John Cutts    99 or more times read
Antiquated laws related to foreclosed homes have been worsening the difficulties of Americans facing foreclosures, according to the National Consumer Law Center (NCLC). The center claims that more than 30 states have fast-track procedures to turn delinquent properties into foreclosed homes without passing through the courts.

The NCLC claims that 30 states and the District of Columbia allow mortgage lenders to auction off foreclosed homes even without filing notices in the courts. The center also noted that renters in these states are given more consideration than homeowners.

NCLC found that while many states have amended their laws to protect tenants, they have not changed laws that clearly tilt the law against troubled homeowners and favor the mortgage lenders. Lawyer Geoff Walsh, co-author of the NCLC study, said that amending laws related to foreclosed homes will help stop the continued increase of foreclosed homes.

Meanwhile, the National Association of Home Builders applauded the tax credits provided by the Obama foreclosure prevention program for homeowners of energy-efficient homes. More tax credits will entice more homebuyers and will re-energize the homebuilding industry.

The previous energy-efficiency tax credits expired in 2007, but were extended under the Bush Administration. Now it has been expanded under Obama’s stimulus package. Homeowners can claim tax credits for their energy-efficiency features.

On the other hand, the Real Estate Owned (REO) Rental Initiative launched by Freddie Mac was meant to help renters and previous owners of foreclosed homes and prevent them from being homeless. This initiative will enable them to stay in the foreclosed homes as tenants and will pay Freddie Mac’s property management firm from month to month.

To be eligible for the REO initiative, renters and previous owners need to show Freddie Mac that they can afford to pay the rentals and that they are willing to open their properties to prospective buyers while they are renting the properties.

To help more American homeowners at risk of losing their properties to listings of foreclosed homes, Freddie Mac has extended its foreclosure moratorium and has suspended eviction proceedings until the first day of April. The suspension will give more time to borrowers to learn all about available schemes under President Obama’s foreclosure prevention program.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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