THE FED SETS GUIDELINES FOR REO RENTALS

By
Mortgage and Lending with Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 NMLS # 6869

“The FED Sets Guidelines for REO Rentals”

Let me know if you have the same reaction as me. Is there any part of our lives that the FED is not involved? How we should act and how we should think. Regulators creating more regulations, this time on REO properties. Just Great!

I used to think how crazy the song “The House of the Rising Sun” by The Animals, was. I now wonder what house they had in mind? Not so crazy anymore! Fed sets guidelines for REO rentals

The sooner we can get the government out of our lives the better and the sooner we get the current administration out our lives, even better.

 

Fed Sets Guidelines for Banks and REO Rentals

 

Federal Reserve-www.thenichereport.com

(Federal Reserve Board ) The Federal Reserve Board on Thursday released a policy statement reiterating that statutes and Federal Reserve regulations permit rental of residential properties acquired in foreclosure as part of an orderly disposition strategy. The statement also outlines supervisory expectations for residential rental activities.

The general policy of the Federal Reserve is that banking organizations should make good faith efforts to dispose of foreclosed properties (also known as “other real estate owned” or “OREO”), including single-family homes, at the earliest practicable date. In this context, and in light of the extraordinary market conditions that currently prevail, the policy statement explains that banking organizations may rent residential OREO properties within legal holding-period limits without demonstrating continuous active marketing of the property for sale, provided that suitable policies and procedures are followed.

Moreover, to the extent that OREO rental properties meet the definition of community development under the Community Reinvestment Act (CRA) regulations, the banking organizations would receive favorable CRA consideration. In all respects, banking organizations that rent OREO properties are expected to comply with all applicable federal, state, and local statutes and regulations, some of which the policy statement highlights. The policy statement, in providing guidance to banking organizations and examiners, also describes specific supervisory expectations for banking organizations with a larger number of rental OREO properties, generally more than 50 properties available for rent or rented.

The policy statement applies to banking organizations for which the Federal Reserve is the primary federal supervisor, including state member banks, bank holding companies, non-bank subsidiaries of bank holding companies, savings and loan holding companies, non-thrift subsidiaries of savings and loan holding companies, and U.S. branches and agencies of foreign banking organizations

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Joe Petrowsky, NMLS #6869

Right Trac Financial Group, Inc. NMLS #2709

110 Main St.

Manchester, Ct. 06042

Office: 860 647-7701 x116

Fax: 860 647-8940

Cell: 860 836-9294

Email: joe@righttracfg.com

www.righttracfg.com

www.joepetrowsky.com

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Joe Petrowsky does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied.

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Wallace S. Gibson, CPM 04/10/2012 06:54 AM
  2. Kevin Guttman 04/10/2012 10:42 AM
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Ambassador
1,902,490
Nestor & Katerina Gasset
International Properties and Investments LLC - Wellington, FL
Realtors, Wellington Florida Homes For Sale

Joe- They want to turn us into a country of rentals. The over reaching of the government into our lives is beyond dispicable. They want to control everything we do, say, eat and where we work, how we work, how much money we get to keep and how much they get to plunder. The rentals will end up being like the slums in Russia. No thank you! Katerina 

Apr 10, 2012 06:43 AM #1
Rainmaker
1,085,621
Wallace S. Gibson, CPM
Gibson Management Group, Ltd. - Charlottesville, VA
LandlordWhisperer

Very similar to the RFP when RTC was turning over properties and wanted IREM members to submit bids for management. 

BoA has a LARGE property management staff for trust held properties so I have no problem with them managing their on REO sfr inventory in house

Apr 10, 2012 06:53 AM #2
Ambassador
1,871,893
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages Connecticut - Middletown, CT
Your Connecticut Mortgage Expert

Joe, given the category that all this fits in, I am waiting for them to come out with a regulation on how we should wipe.  Front to back or back to front, what do you think ........ LOL

Apr 10, 2012 07:32 AM #3
Rainmaker
120,537
Kevin Guttman
Fairway Mortgage Corp. - Colorado Springs, CO
Top Mortgage Originator

Joe,

This being an election year, I am thankful for the opportunity to vote. 

Of course, we don't vote on the federal reserve, but our elected officials appoint them!

Thanks for the update on this.

Kevin

Apr 10, 2012 10:41 AM #4
Rainmaker
977,730
Sharon Alters
Coldwell Banker Vanguard Realty - Fleming Island, FL
Your Fleming Island Relocation Agents.

Joe, is the prelude to a 'rent bubble' which has been eluded to - avoid lots of REO properties for sale by renting them and creating chaos in the rent arena??

Sharon

Apr 10, 2012 08:58 PM #5
Rainmaker
1,058,364
Conrad Allen
Re/Max Professional Associates - Webster, MA
Webster, Ma, Realtor

Hi Joe.  That gobbledygook did not talk about the rent.  How will that be determined?

Apr 11, 2012 03:46 AM #6
Rainmaker
1,099,140
Lisa Von Domek
Lisa Von Domek & Associates LLC, Real Estate Broker/Associate with Real Living Real Estate Group www.LisaVon.com - Dallas, TX
....Experience Isn't Expensive.... It's Priceless!

Good morning Joe,

Another way for the government to provide free housing at the taxpayers expense...just watch and see.

Apr 12, 2012 04:20 AM #7
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Joe Petrowsky

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