Housing Regulator Is Pushed to Crack Down on Sales of Foreclosed Properties.
'Lawmakers are pressing the nation’s housing regulator over the sale of thousands of foreclosed houses to investment firms that have pitched the promise of homeownership to people unable to get a traditional mortgage.
Some local authorities and regulators are taking legal action against several of these firms, accusing them of engaging in predatory business practices by reselling these often rundown houses “as is” through rent-to-own and other seller-financed transactions, sometimes known as contracts for deed.
Since the 2008 housing crisis, seller financing has become a lucrative business model as banks have largely stopped lending to lower-income families and the government has tried to sell a huge inventory of foreclosed homes.
Two of the nation’s largest firms in this business — Vision Property Management and Harbour Portfolio Advisors — have come under federal and regulatory scrutiny after a series of articles on them in The New York Times.
On Thursday, Representative Elijah E. Cummings, Democrat of Maryland, who sits on the House Committee on Oversight and Government, wrote to the director of the Federal Housing Finance Agency, urging the regulator to stop Fannie Mae and Freddie Mac, the big government-controlled mortgage finance companies, from selling foreclosed homes to these firms.
Other lawmakers have raised concerns, too. During a Senate hearing on the future of Fannie and Freddie on Thursday, the F.H.F.A. director, Melvin Watt, was questioned about the sale of foreclosed houses to firms using contract for deed.'>>>
https://www.nytimes.com/2017/05/11/business/dealbook/foreclosed-houses-investment-firms-predatory-practices.html?