New Rules for Foreclosures

It seems that big business is getting a taste of what its been like to be a consumer the last 8 years. President Obama signed a new law giving homeowners and others more rights when it comes to foreclosures.

Today the current administration made good on their promises to help homeowners and other victims of foreclosure. President Barack Obama signed into law new regulations designed to make it easier for homeowners facing foreclosure to refinance their existing mortgage into a fixed loan with lower payments they can afford.

The new law also targets other victims of foreclosure. Prior to the new law, if you were renting a home that was foreclosed on you had no rights or recourse at all. People that had signed a lease or were current on their rent were forced out of the house sometimes with no warning. The new law signed today will give force the foreclosing banks to honor any existing leases on the property. Renters that are on a month to month basis will have 90 days to find a new residence before having to vacate the property. It seems like this is a win-win for everyone involved. The Las Vegas real estate market has the highest foreclosure rate in the country. Sometimes properties sit vacant for six months or more before they are finally sold. Rather than having them sit vacant generating no income, at least the banks will be making some money in the interim. Plus it should slow down the flood of properties for sale hitting the market.

The new law works in conjunction with Hope for Distressed Homeowners program and other prior legislation. Not everyone will qualify for this program as it was designed to target homeowners that are not completely upside down in their mortgage and are losing their home due to either predatory lending practices or as a result of the economy (job loss, etc). Also, only homeowners that have a Freddie Mac or Fannie Mae loan will be eligible.

Hopefully this new law along with the First Time Home Buyer Tax Credit and the new Renewable Energy and Energy Efficiency Tax Credits will help stablize the housing market and the economy.