SOURCE: National Community Stabilization Trust

April 14, 2016 15:58 ET

Press Statement: FHFA Policy Changes

WASHINGTON, DC--(Marketwired - April 14, 2016) - Today, FHFA announced critically important policy changes that will help homeowners, neighborhoods, and the housing market. First, the agency created a streamlined modification that includes principal reduction, a proven strategy for sustaining homeownership. Second, FHFA added important requirements to its distressed asset sale program that require note buyers to provide high-quality, sustainable modifications to homeowners and prohibit note buyers from walking away from low-value properties.

In response to the FHFA announcement, Rob Grossinger, President and CEO of the National Community Stabilization Trust, issued the following statement:

We commend FHFA for today's announcement. Principal reduction not only helps families stay in homes, but it stabilizes neighborhoods and boosts local economies. We're especially pleased to see FHFA require buyers of distressed GSE notes -- who purchase those assets at a discount -- to pass some savings along to homeowners through principal reduction, along with the other rules ensuring safe and sustainable modifications. 

Additionally, prohibiting note buyers from walking away from properties before foreclosure sale will make a significant difference for struggling communities. Preventing the proliferation of "zombie" properties will stabilize neighborhoods, prevent blight, and save taxpayer money. Also, providing the public with pool-level data will provide additional transparency around the program's outcomes.

We look forward to continued collaboration with FHFA to develop appropriate and scalable disposition strategies for low-value and vacant homes that should not be sold through national bulk auctions.

The National Community Stabilization Trust (NCST) is a non-profit organization that aims to restore vacant and abandoned properties to productive use and protect neighborhoods from blight. Established in 2008 by several leading community development organizations and civil rights groups, NCST combines deep policy knowledge with hands-on operational expertise in asset management, technology platforms, data analysis, and REO operations.

For interviews or more information, please directly contact:
Rob Grossinger, NCST president at 202-706-7500, or
Julia Gordon, NCST executive vice president, at 202-669-0424.

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