WORLD PROPERTY CHANNEL ®

I don't know about you, but there is something bothering me about a new foreclosure-fighting program our federal government rolled out last week.

Real Estate Channel reported on the program Nov. 6, 2009:  ("Failing Fannie Mae's New Deed-for-Lease Plan Could Make it Nation's Largest Residential Landlord.")

What is bothering me is the fact that the government, through its lackluster agency, Fannie Mae, will shortly be in the business of acting like a regular residential real estate brokerage house, competing unfairly with certified brokers across the country who depend on average 6 percent to 7 percent sales commissions for their livelihood.

This will happen when the occupant-owners of the houses turn over their property deeds to Fannie Mae and start renting their own homes for a 12-month period.

At the end of the 12-month period, the government is free to sell the house on the open market.

This whole Deed-for-Lease exercise is supposed to delay a conventional foreclosure on the property and give the owner-occupants a 12-month breather  before they formally lose their property.

Now isn't that just wonderful American-like, good Samaritanship?  No, it is not.  It is un-American.

If the government is so tolerant and forgiving, why not show the financially-battered owner-occupants some real liberality?

Why not set up a program that would credit a portion of the owner-occupants' rent payments towards a re-purchase of their home?

Timothy Geithner

There are enough brains in Treasury Secretary Timothy Geithner's stable to come up with a creative and fair re-purchase plan for the owner-occupants.

I mean if Geithner's group can shell out taxpayer dollars and loan guarantees to the total tune of $306 billion to Citigroup and $180 billion to AIG, surely there are some additional taxpayer pennies around that could shape a new re-purchase program for beleagured owner-occupants.

If Geithner's gang is too busy or just can't be bothered with such a low-priority topic, why not have CEO Michael J. Williams's bunch at Fannie Mae tackle the subject?

I mean, after all, Mr. Williams did pocket an annual salary himself in 2008 of $676,000 and a bonus of $871,000 for a total $1.54 million.   His corporate associates also did well for themselves.

Michael J. Williams

What is also bothering me about this un-American Deed-for-Lease program is that eventually, after the government has stacked up enough owner-occupant deeds in its foyer, there is going to be another glut of houses hitting the residential market, just when that market would be starting to fully recover from this 26-month Depression.

That glut will comprise the government-owned houses Fannie Mae has obtained from foreclosure-hit owner-occupants.

Freddie Mac, another failing quasi-government shelter agency, has a similar Deeds-for-Lease program.  Freddie Mac flacks claim two-thirds of owner-occupants who have been offered monthly leases to date have taken them.

I don't believe it. 

I know the two agencies mean well.  They want to help the foreclosure-hit owner-occupant in any way they can.

But taking people's homes away from them in the guise of giving them an extra 12 months of occupancy in their own home is not the way to do it.

And that's the way I see it - for now. 

Please see related columns:

Alex's View of the World, Nov. 6, 2009
Alex's View of the World, Oct. 30, 2009
Alex's View of the World, Oct. 23, 2009
Alex's View of the World, Oct. 16, 2009
Alex's View of the World, Sept. 18, 2009
Alex's View of the World, July 31, 2009
Alex's View of the World, July 24, 2009
Alex's View of the World, July 17, 2009
Alex's View of the World, July 10, 2009
Alex's View of the World, May 15, 2009
Alex's View of the World, April 10, 2009

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