Fannie Mae to Sell 2,500 Foreclosed Properties

WASHINGTON (MarketWatch) — Fannie Mae is offering to sell nearly 2,500 foreclosed properties to investors as part of a new federal initiative to aid the housing market by selling off distressed properties in bulk, the company’s regulator said Monday.

The Federal Housing Finance Agency released details of a planned pilot transaction under which the government-controlled mortgage-finance firm will offer the properties for sale to investors in bulk, but require those investors to rent them out. A mix of tenant-occupied and vacant properties in Atlanta, Los Angeles, Phoenix, Las Vegas, Chicago and parts of Florida will Seaboard Properties offered for sale.

About 1,700 are single-family homes and more than 525 are condominiums, according to a summary of assets for sale released by FHFA. Potential investors are being asked to demonstrate their financial capacity and experience and detail their plans for the properties, which must be rented out for a specified period.

“This is another important milestone in our initiative designed to reduce taxpayer losses, stabilize neighborhoods and home values, shift to more private management of properties, and reduce the supply of [foreclosed] properties in the marketplace,” said Edward DeMarco, the FHFA’s acting director.

Michael Stegman, a Treasury Department counselor for housing finance policy, said in a statement that the initiative would aid “neighborhoods that were especially hard-hit by the housing crisis and will help meet the rising demand for rental housing in many communities.”

Investors are being required to post a security deposit and sign a confidentiality agreement before they receive access to detailed information about the properties.

Article Courtesy of The Wall Street Journal: MarketWatch by Alan Zibel

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