Cooome on now, just give us the house back, keep it occupied, and you'll have plenty of time to find new digs. Oh- and your rent will be reasonable.

I can't come to a conclusion on this new program. In a nutshell, Fannie Mae accepts a deed in lieu of (read article for limitations) and the homeowner-now-renter is able to remain in the home for a period of a year, subject to a month-to-month following that agreement.

Of course, it won't work for the unemployed or under employed, because "market rent" may well eclipse their means.

The plusses: those with children in school may qualify, preventing the shock of a forced move. Those that do love their homes will have the opportunity to remain for a longer period of time. Neighborhoods that might get a blighted appearance will (presumably) remain less so, with occupants in the house.

The "asset" will be better preserved.

The downside: the seller is accepting a deed-in-lieu of foreclosure, and the credit ramifications of such create a near-equal ding as a foreclosure might. There might be less incentive to work toward a short sale solution, with it's potential for less of a credit hit (along with a personal sense on the part of some sellers that they did, indeed, inject some integrity into a bad situation. Subjective, but surely many sellers walk away with a better self perception). It would appear that the program is not applicable to those with second mortgages/liens on the property, knocking out huge numbers of people that are in trouble for exactly that reason. A deed-in-lieu of has no guarantee that there won't be some kind of shortage expected of the homeowner upon surrender. 

It's common sense to presume that all homeowners should have at their disposal every avenue available to them, and the current arsenal appears to provide yet another outlet for consideration. Will it be a well-run resource that improves the experience of those losing their homes?

Guess time will tell.