Congress unanimously passed a bipartisan plan last week to let FDIC-member banks lease real estate-owned properties back to foreclosed homeowners-a move that legislators hope will protect both mortgage lenders and borrowers from the worst effects of the foreclosure crisis.
The Neighborhood Preservation Act “will give struggling families an opportunity to stay in their homes while riding out the housing crisis, and will be instrumental in alleviating the overall crisis in the housing sector,” said Rep. Gary G. Miller (D-California), author of the measure. Rep. Barney Frank (D-Massachusetts), chairman of the House Financial Services Committee, is a co-sponsor of the bill.
Under the bill-which the House approved in a voice vote-banks may lease properties acquired through foreclosure or a deed-in-lieu for a term of up to five years. Rent-to-own options are also encouraged under the measure, which would apply only to leases signed in the next two years.
Where does it stop ?
