The first pilot under Real Estate-Owned (REO) Initiative was announced Monday by the Federal Housing Finance Agency (FHFA) that will allow more REO properties to be sold in the hardest-hit areas in the United States.These areas include: Atlanta, Chicago, Las Vegas, Los Angeles, Phoenix and part of Florida.

This initiative is designed to help lower taxpayer losses, stabilize neighborhoods and home values while also shifting to more private management of properties and reducing the supply of REO in the home market. In addition, the FHFA hopes this will also help meet the rising demand for rental housing.

Prequalified investors will be sent details of the sale and then will be able to submit applications that demonstrate their financial capacity, experience and outline specific plans for purchasing pools of Fannie Mae foreclosed properties. They will be required to rent these purchases properties for a specific amount of years. Any investor interested can complete the forms on the FHFA REO Initiative page.