With the ongoing sub-prime mortgage crisis, more and more homeowners are finding themselves in over their heads. Saddled with an adjustable rate mortgage that has already or soon will reset at a much higher interest rates, they are unable to afford the new payments and begin drowning in debt. The available options are few: bankruptcy; defaulting on the mortgage; or even walking away from the house and letting the bank have it.
Thank goodness there is another way. You can choose the “rent back house” option. This is how it works. When you sell your house get the buyer to agree to rent it back to you. He may even let you buy the house back eventually. This is called “sell and buy back“. Either plan may work well for you.
With a rent back house agreement, everyone wins. The seller is able to remain living in the residence and doesn’t have to open his life to the disruption of moving. The buyer adds a property to his list of assets, receives the monthly income of rent payments, and has a ready-made motivated buyer who will repurchase the property when they can.
This program however, would not only benefit those people who knowingly got tricked into getting an adjustable rate mortgage, or even those who knew exactly what they were doing, but many other people stuck with a bad loan due to the many reasons banks are allowed to do such things. Some of the reasons might be personal problems such as getting divorced, unpaid medical bills, bills or loans going to collection or other legal matters.
If you are a seller who may encounter this type of situation, you ought to ask a realtor, or search the web for “rent back house” options. For this type of situation, it is imperative that you use an attorney to protect your real estate interests and to help you negotiate the best overall deal for you.
If you think you might like to use this option consult a realtor or search under “homes on sale and rent back“. Be very careful, however, because you may be vulnerable. Learn all you can about your buyer and make sure he is reputable. You should also consult an attorney who can ensure that everything is legal.
An increasing number of homeowners are in dire straits in the wake of the sub-prime mortgage debacle. They can declare bankruptcy, they can go into default, or they can simply walk away and allow the bank to repossess the house. Thank goodness there is another way. You can choose the “rent back house” option. When you sell your house get the buyer to agree to rent it back to you. He may even let you buy the house back eventually. This is called “sell and buy back“. If you are considering investing in this option, search under “homes on sale and rent back“.
- Peter Shukla
This entry was posted on Monday, December 14th, 2009 at 1:12 pm and is filed under Finance, Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.
