"Today the nation faces a disproportionately large inventory of homes with additional 'shadow inventory' to come on line soon, in the face of a weak job market and weak housing demand," Stevens said. "Getting more REO properties into the hands of owner-occupiers would be the best option for stabilizing neighborhoods."
The MBA puts the shadow inventory of mortgages delinquent 90 days or more or already in the foreclosure process at about 4 million homes. With about 1 million to 1.2 million foreclosure sales and short sales a year, the MBA estimates it will take three and half to four years to move through this inventory overhang.
Read it allSome of the recommendations the trade group sent to the FHFA include a heightened focus on providing preferential financing to resident owners; expanding finance options and incentives for local investors; increasing protections for investors against fraud; and improving transparency.