Fannie, Freddie foreclosures will pick back up

Those hiring moving companies will again be able to choose from the wide selection of distressed properties that have been acquired by Fannie Mae and Freddie Mac.

The government-sponsored mortgage giants sent a memo to real estate agents around the country, telling them they could resume the marketing and sale of distressed properties. The institutions had initially halted foreclosure sales until it could complete an internal review of its documentation procedures, in line with the actions of a number of other lenders, including Bank of America and Ally Financial. Those companies had already announced they would resume foreclosure sales. The halts began once reports surfaced that some lender employees signed foreclosure documents without properly reviewing them.

"Our decision was motivated by several factors including the protection of buyers with title insurance, the negative impact lingering foreclosed properties has on neighborhoods and the cost burden that is placed on taxpayers when [bank-owned] sales are suspended," a Fannie Mae spokeswoman told the Wall Street Journal.

The news comes at a time where various reports suggest overall home sales have faded amidst lender halts. Real estate agents have said that many buyers relied on distressed properties as a way of moving into a home for a lower price.

However, other reports suggest that foreclosed homes have fallen out of favor for many buyers. Campbell Surveys reports that 14 percent of homebuyers in October said they would not even consider moving into a foreclosed property, primarily out of concerns extending from the documentation scandal.
 

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