Nephos has asked that I point out when I've been right. You may remember this little gem
I expect builders and banks both to start reaching out to management companies to rent all of these condos and houses that are starting to sit around. I don't know if there even are any national players, but that seems like a business that's going to seriously take off.
And today(PDF)?
Introduction
Fannie Mae is introducing the Deed-for-Lease Program (D4L), a program designed to minimize family displacement, deterioration of neighborhoods caused by vandalism and theft to vacant homes, and the effect these have on families, communities and home price stabilization. D4L allows qualifying borrowers of properties transferred through deed-in-lieu of foreclosure (DIL) to remain in their home and community by executing a lease of up to 12 months in conjunction with a DIL.
...
Effective Date
Servicers can begin offering D4L immediately.
Servicers are third parties. This is a great business. Short sale to Fannie Mae, then a third party charges enough so the tenant can't save up to buy back his or her house, but not so much that they have to evict.
Update: I should point out that was a 25-month lag
5 comments:
Being proved right is always good for the psyche, and I wouldn't minimize it by pointing out the time lag. 25 months! That's practically Nostrodamian!
If you could narrow down an average length of your foresight, then you'd really be in business.
25 months is about right, I think. Predicting that NEWCAG's policies would end in disaster just got you quizzical looks in the 90s, and people just remember you as a crank.
Remember 2005 was too early. Guys like Nouriel Roubini and Michael Ruppert were hailed as visionaries for yelling doom from 2006 and 2007. Two years is roughly the visionary time frame.
I suspect that visionarionism is scale-dependent. Perhaps you could up your foresight merely by choosing some larger scale phenomenon. For example, saying the US will succumb to progressive currency devaluation over the coming decades, and that civilization will collapse over the coming century may be a totally doable foresight. On the other end, you might use your crystal ball to forecast that you will eat dinner tonight.
But, then, for the latter no one cares because it's trivial, and for the former no one cares because they'll be dead. Yeah, you're right. Stick to two years. It's still impressive.
On its face, the D4L program seems to make sense from the lender's prospective. It eliminates much cost in the foreclosure process and fighting from the homeowner. However, from the Debtor or home owner's side, the only real benefit that I see is that the displacement of the occupant is simply stayed for 12 months, with no real opportunity to redeem the property. It is unlikely that at the end of the 12 months the occupant will be in a better position relative to their credit score or financially.
Michael,
I agree, but I further expect that the program will be rolled over indefinitely, and people will be perpetually renting their formerly 'owned' homes.
RFM
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