Up until now the Fed has kept their fingers out of the housing market, but even they now realize the far-reaching impact the foreclosure crisis is having on the overall economic climate. In the white paper they offer up several suggestions, such as reducing the barriers to converting foreclosed homes into rental properties, and loosening the grip on lending standards in order to help the market recover.
The Fed now wants harsher action from Congress on America’s top lenders, and Governor Sarah Bloom Raskin even told a conference at the Association of American Law Schools that the Fed “must impose penalties for deficiencies that resulted in unsafe and unsound practices.”
It must be time to check our subscriber list to the South Florida Law Blog, because it sure looks like our friends at the Fed are on it!
We’ve suggested for a while now that turning foreclosed homes into rental properties is an obvious and logical step. For years banks have collected homes like animals in Noah’s Ark, and now it’s time to put this inventory to good use. 60 Minutes showed us what happened when these homes go empty, so why not put good people in these homes! The government may not like the idea of becoming a landlord, but really isn’t it better than the alternative!! This mass inventory of foreclosed homes can be an asset for our government if more of them are rented out, instead of being a detriment.