Should the US Government allow banks to rent foreclosed homes?

Update: 7-29-2011:  Ok, Fannie Mae and Freddie Mac, as owners of some foreclosed properties, may decide to rent them as opposed to try and sell them.  But that might just cause more cost in the long run by delaying the inevitable ale and won't make a huge dent in the wave of 4-6 million more foreclosures to come. Source: http://www.mortgagenewsdaily.com/channels/pipelinepress/07282011-nike-sifma-debt.aspx

My first thought when I read the artile below is - What business is it of the US Government to say what private business should or shouldn't do?  But then I woke up from that dream and found myself in reality....

US Government probably thinks the number of distressed properties would decline, thereby reducing pressure on prices, allow real estate prices to stabilize and increase, create more tax revenues for states/local government through higher property taxes; and help the economy recover....all good stuff for governments...

But what do the banks think?  Do they want the injury/damage liability of renters living in their properties? What will be the cost of repairing or selling a property in the future that may not be of the same or higher value as it is now?  Will they want the continued monitoring/maintenance issues that may or may not be covered by the amount of rent on their property?

Bottom line:  Banks are in the business of lending money, not holding assets - they would rather take a hit to get rid of a property and loan what they get from a sale than keep it on their books as a nuisance and further liability. But as I learned in grad-school, "it all depends"... on how sweet of a deal the US Government proposes and how banks' bottom line can improve on the implementation of such an idea!

Source: http://realtybiznews.com/government-plans-to-rent-out-foreclosed-homes/9874253/

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