Fannie shields renters caught in foreclosures

By Charles Duhigg, The New York Times  |  December 15, 2008

The loan giant Fannie Mae said yesterday that it would sign new leases with renters living in foreclosed properties owned by the company.

It is the first nationwide effort to provide widespread relief to renters ensnared by the unfolding mortgage crisis, and it will effectively transform Fannie Mae - a government-controlled mortgage finance company - into a national landlord. It may also increase pressure on private lenders to establish similar programs and on lawmakers to pass renter relief.

"There are renters all around the country who have been holding up their end of the bargain and paying their rent faithfully, but the landlord got into trouble, and so the renter is now unfairly facing eviction," said John Taylor, president of the National Community Reinvestment Coalition.

Fannie Mae's initiative is expected to initially benefit as many as 4,000 renters living in foreclosed homes.