Friday, October 17, 2008

Protecting housing in foreclosure

While national headlines report on bank rescues, people at the local level are dealing firsthand with the aftermath of foreclosure.

In some places, once the former owner moves out, the property is stripped of all valuables, especially copper gutters, downspouts, plumbing and wiring. In no time, the lender's security in the loan, the house, loses a huge percentage of its value.

Given the challenges of managing and maintaining vacant houses, maybe lenders would be better off allowing former owners to stay in their houses? This could be worked out on a lease/purchase or straight rental basis. The lender becomes landlord; the former owner becomes tenant, and pays rent instead of a mortgage payment.

Maybe it's a starting point for compromise? Foreclosed homeowners need a place to live. Vacant buildings are problematic. Rental income to the bank is better than zero income from a vacant house. And protecting the house from being stripped is better for the neighborhood.

1 comment:

Ross Rocketto said...

Rick,

My name is Ross Rocketto and I work for KETC/Channel 9. We are currently working on a community engagement initiaitve designed to connect residents of the st louis community to foreclosure prevention resources.

We are working with a host of agencies that provide housing counseling assistance such as Beyond Housing, the Urban League, Catholic Charities, Better Family Life, and ClearPoint Finanicial Solutions.

Right now we are looking to further our work by engaging the local St. Louis blogging community and as I was searching St. Louis blogs I came upon this post. I was wondering if you may be interested in somehow working with us as we move forward on this initiative.

Please check us out at www.ketc.org/mortgagecrisis and shoot me an e-mail if you are interested rrocketto@ketc.org

Thanks,
Ross