Regulatory AlertsPolicy Statement on Rental of Residential Other Real Estate Owned Properties
The Federal Reserve issued this policy statement to clarify that banking organizations may rent one- to four-family residential Other Real Estate Owned properties without demonstrating continuous active marketing. The guidance permits this practice as part of an orderly disposition strategy, provided institutions adhere to statutory limits, holding-period requirements, and applicable landlord-tenant laws. Specific supervisory expectations are established for large-scale rentals involving 50 or more properties, requiring formal policies, risk management frameworks, and oversight of third-party managers.
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