As the mortgage crisis unfolds, the fate of many property owners has been clear: pay the bills or face foreclosure. But what about the renters who dwell in these properties - what happens to them as their lenders face the music? On Sunday, mortgage giant Fannie Mae said they’re working through a policy that could allow as many as 4,000 renters to stay in their homes despite the fact that their landlords are being foreclosed upon. Reports say that Fannie plans to halt evictions until the new year when it will reach out to tenants to sign new leases with them or offer assistance in the relocation process. This comes after many months of uncertainty for renters who have been in limbo throughout the mortgage meltdown.

As of September, Fannie Mae owned 67,500 properties in foreclosure, but most of these were owner-occupied and will not benefit from the new policy. Fannie Mae spokesman Chuck Greener said: "While it may be sometimes tougher to sell a property when people are in it, we understand that lost of people are in tough situations right now. If a renter wants to stay in their home, we'll make that happen. And if they want to move out, in many cases we'll help them pay for the move."

Fannie Mae stepping up to face this problem could put pressure on other private mortgage lenders who are dealing with renters in similar situations. Freddie Mac hasn't announced any policy along these lines, but has said they are considering a number of options. Either way, this is a step in the right direction to help struggling renters who, by no fault of their own, are finding themselves stranded. Fannie Mae hasn’t posted information online, but check back at FannieMae.com to get details as soon as they're available.


Jackie DeAngelis is a writer and producer at CNBC. Previously she worked as a financial analyst at Oaktree Capital Mgmt. Jackie earned her J.D. from Rutgers Law School in 2008 and her B.A. in Asian Studies from Cornell University in 2002

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