Renting to Save Your Own Home


| May-June 2010


“The country is on a path where it is likely to see foreclosures at a pace of more than 150,000 a month for at least two years,” warns Dean Baker, codirector of the Center for Economic and Policy Research in Washington, D.C. Instead of rushing to retool the system, policy makers seem to be at a standstill. They need to do something radical. And they need to do it quickly.

Enter Baker. In the Fall-Winter 2009 issue of Shelterforce, he proposes that Congress pass a “right to rent” law, meaning that legislators could bend the policy rules and make it legit for homeowners facing foreclosure to stay in their homes for a set number of years (he suggests 5 to 10). They would simply pay the market-value rent, which would be determined by an appraisal jointly paid for by the renter and the lender. The agreement would also protect the tenant from eviction without just cause, and no taxpayer dollars would be used.

Baker acknowledges that fears about letting banks play landlord when they lack experience are legitimate but notes that many already contract with management companies to handle tenants. Another concern is that without the option to foreclose, lenders would see mortgages as riskier lending situations and thus hike interest rates. This threat is actually a potential upside, Baker says, since it might mean banks would become more cautious about making loans when housing prices are out of step with economic reality.

So far no state has enacted a right-to-rent law, but mortgage giant Fannie Mae offers a one-year rental plan that can be renewed, and Freddie Mac has a plan that operates month to month.
















Pay Now Save $5!

Utne Summer 2016Want to gain a fresh perspective? Read stories that matter? Feel optimistic about the future? It's all here! Utne Reader offers provocative writing from diverse perspectives, insightful analysis of art and media, down-to-earth news and in-depth coverage of eye-opening issues that affect your life.

Save Even More Money By Paying NOW!

Pay now with a credit card and take advantage of our earth-friendly automatic renewal savings plan. You save an additional $5 and get 4 issues of Utne Reader for only $40.00 (USA only).

Or Bill Me Later and pay just $45 for 4 issues of Utne Reader!




Facebook Instagram Twitter flipboard


Copyright 2018, All Rights Reserved
Ogden Publications, Inc., 1503 SW 42nd St., Topeka, Kansas 66609-1265