'Right to Rent' as Way out of Foreclosure Crisis

The way out of the foreclosure crisis may not be as difficult or as complex as it has been made out to be, argues Dean Baker of the Center for Economic and Policy Research.

"Millions of people face the loss of their homes over the next few years. While the politicians in Congress have developed a wide variety of complex schemes in order to hold back this flood of foreclosures, including one passed into law last summer that provided up to $300 billion guarantees for new mortgages on homes facing foreclosure, none have had much impact thus far.

[But] there is an easy solution. Congress can temporarily modify the rules on foreclosure to give families facing foreclosure the right to rent their homes at the market rate for a substantial period of time. Rep. Raul Grijalva proposed such a change in the Saving Family Homes Act, which would allow homeowners the option to remain as renters for up to 20 years following a foreclosure. Giving the homeowner the right to stay as a renter hugely increases their bargaining power with the bank."

Full Story: Keep it Simple: Stop the Foreclosure Crisis with the Right to Rent
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Michael Lewyn's picture
Blogger

Existing foreclosures

Is there any way this could be expanded to affect already-foreclosed homes? That is, is it possible to say to lenders: "You better rent out the homes you have foreclosed, or else we're going to demolish them to prevent them from being nuisances."?

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