When the housing bubble burst, it left a lot of people scrambling to find a solution to help them keep their homes. Those who had enjoyed the convenience of an adjustable rate mortgage learned that while having a low-interest rate is great it can quickly become a disaster when the economy is shaky. Many people found themselves facing foreclosure and some had to do a short sale, selling their home for less than what they actually owe. In return, the banks released them from what they owed and the homeowners were able to walk away with at least a little money.
Renters are now hearing the term ‚Äúshort sale‚Äù a lot more than they used to hear it. When you rent a home, you are helping the landlord pay his or her mortgage. If the property the landlord is renting to you is behind on mortgage payments, then the landlord will need to come up with some way to make up the money or the property could be foreclosed on. Not only will your landlord lose the property, but you will also lose your home.
You and your landlord have options and you do not have to accept a foreclosure on your landlord’s home where you will end up homeless. A short sale could be exactly what you and your landlord both need. Once your landlord lets you know that there is trouble you can discuss a short sale with him or her. A short sale would allow you to buy the home you rent for a lower price than what you might expect. It will also benefit your landlord and the bank.
In the case of your landlord, he or she would be able to sell you the property and then simply walk away. They could avoid the negative effects of a foreclosure on their credit and will be able to avoid owing money to the bank. As far as the bank is concerned, they will be able to avoid the costly process of a foreclosure and having a property sit empty for any length of time. You would avoid losing your home. For everyone, it is a win-win situation.
When you are offering to buy the home from your landlord, all you really need to do is make the suggestion and then explain the benefits. It is unlikely that your landlord will not agree to such a deal. Most banks are preferring to do short sales over foreclosures so you should have no trouble if you and your landlord discuss a short sale with the bank. Your landlord is not your enemy, so do not be afraid to discuss this option with him or her. The bank will most likely help you find funding and you will be able to get the keys in just a few weeks and become a homeowner yourself.