After hearing about Fannie D4L’s program (Deed for Lease), my cousin made sure that Fannie owned his loan (http://loanlookup.fanniemae.com/loanlookup/), and then called them because he was having trouble with his water heater’s pilot light. As you can imagine, the call didn’t go very far up Fannie’s org chart. Many are viewing the program somewhat skeptically, saying that Fannie and banks can’t manage the properties that they own now. The program is meant to allow some homeowners facing foreclosure to hand the deed back to their lender but remain in the home as a renter – the servicer has to decide that the borrower qualifies for a “deed in lieu of foreclosure.” The rent can’t exceed 31% of their monthly gross income, the borrower cannot have 12 or more past-due payments on their mortgage and they must have made at least three payments since the loan was first taken out. Primary residence only – and no non-Fannie loans please! The borrower’s credit score is indeed impacted, but not as badly as a foreclosure.

Freddie Mac reported a third-quarter net loss of $5.01 billion versus a loss of $25.3 billion in the same quarter a year earlier. After payment of $1.3 billion dividend on its senior preferred stock to the Treasury Department, Freddie Mac’s net loss came in at $6.3 billion. Freddie has had over $63 billion in net losses over the seven quarters ended in March, and has used over $50 billion in government/taxpayer capital in the last year (which pay us a 10% dividend).

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