NHC, foreclosure task force sign on to recommendations for jettisoning residential property inventory
September 15, 2011
WASHINGTON—The National Foreclosure Prevention and Neighborhood Stabilization Task Force has released a seven-point response to a request for information from the Federal Housing Finance Agency and the Department of Housing and Urban Development on how to dispose of the inventory of more than 92,000 homes the Federal Housing Administration, Fannie Mae and Freddie Mac now own in the wake of the darkest days of the foreclosure crisis. The sign-on letter outlines seven principles designed to help ensure that as taxpayer-backed lenders determine the best course to reduce their real estate owned (REO) inventory, policies that promote stable neighborhoods and a strong housing finance system are implemented.
National Housing Conference Vice President for Policy and Advocacy Ethan Handelman, the author of the sign-on letter, is clear that the letter serves not just as a strategy for reducing the existing REO inventory but also as a roadmap to guide policy as additional foreclosures hit the market.
“We are still in the midst of a foreclosure crisis,” Handelman wrote. “More distressed homes are headed to the market, as the average serious delinquency rate is [at] a historically high level only slightly down from the peak.”
The sign-on letter recommends that REO disposition should complement Neighborhood Stabilization Program strategies, implemented as local initiatives in high-foreclosure communities to mitigate impacts on neighborhoods and families and reduce blight. Among other proposals, the letter also advocates for better regulation of those buying REO properties and managing the REO properties as rentals, better opportunities for creating long-term affordability and green renovation in the acquisition process, and better access to high-quality properties for nonprofits to improve asset management outcomes.
Interested parties can read the sign-on letter here and the National Foreclosure Prevention and Neighborhood Stabilization Task Force is accepting new signatories. The deadline to respond to the request for information from FHFA and HUD is September 15.