Beginning on January 9th, renters who have been paying their rent, yet live in homes or apartments being foreclosed on, by Fannie Mae, will be able to stay in their home.
While it sounds reasonable to assume that if a renter had been up to date on their payments, yet the landlord was in foreclosure, it should not affect the renter. This has not been the case. Until now, if a foreclosure happened, the renter was, well, out of luck. Imagine paying your rent on time every month and then receiving an eviction notice.
While this new agreement, a part of the $700 billion Economic Stabilization Act, only applies to renters in homes under the control of Fannie Mae, it is a step in the right direction. As part of the Act, both Fannie and Freddie as well as mortgage holders, were instructed to let renters stay in their home as long as they were paying rent, until their lease ran out. So far Fannie Mae is the only one setting policy to do so and will now be acting as a landlord.
In the past when renters were evicted under these circumstances it also severely impacted the ability to sell the income property as there were no renters and, thus, no income. The change should help keep these income properties more viable.