Avoid Foreclosure: An Option That Many Do Not Know About
Avoid Foreclosure: An Option That Many Do Not Know About
If you are among one of many homeowners facing foreclosure, there may be a creative technique to save your home. Save your home and salvage your equity so that you can fight again. The last thing that you want to do is give your home back to the lender. If your financial hardship has left you in a position whereby you are not able to pay your mortgage payment, whatever the reason may be, then you cannot afford to live in your home.
Foreclosures are growing dilemma for many homeowners in Calgary today; foreclosures are at an all time high. On the bright side of things, you may have an option that may allow you to keep your home, even if the foreclosure process is already under way. Something that has been around for many years, and you may possibly utilize to save your home and equity. You may need to wait a year or two in order to cash out the equity on the property, but it is better then the alternative.
This option is referred to as a Lease Option/Rent To Own, find a tenant to lease your home from you, with an option to purchase the home at the end to the agreed period or time; usually 12 to 24 months. You set a price for them to buy the house when the agreement is signed; this will allow you to set the price so you can save the equity and by some time to recover. With a tenant that has the option to buy your home you may be able to:
1) First and foremost is the avoidance of a foreclosure
2) Since renters are paying less today due slower market, this may be a way to increase the monthly rent, due in light of the purchase agreement
3) A one-time payment, up-front as a non-refundable deposit, this is usually 1% – 3% of the sales price. The best part of this is that even if they decide not to buy your home, you still keep the money
4) Quickly locate a buyer for your property, most times faster then trying to sell you home in the traditional manner
5) Someone else will be paying the mortgage payment, and potentially a few hundred dollars a month more.
This is a very valuable strategy to keep in mind, especially during market that in a distress. While there may be many other reasons to take advantage of a lease option, they are defiantly an excellent way to avoid foreclosure, and salvage your home from the bank. In a foreclosure, your credit will be destroyed for years to come, and the additional financial repercussions can take a tool on your personal life.