Fannie Mae Offers Foreclosure Alternative

Homeowners facing foreclosure will be allowed to rent their homes at market rates for up to a year. The program, called "Deed for Lease" was announced by government-controlled mortgage backer Fannie Mae on Thursday.

Homeowners voluntarily exchange the deed to their house back to the lender for the right to rent their home at market rate. Rental rates will likely be less expensive that mortgage rates for those who purchased at the top of the housing boom. Supporters of Fannie Mae's "Deed for Lease" program say the company's actions will provide much-needed relief to those who do not qualify for a loan work-out.