Real Estate - Renting, the present danger!
Categories: Buying Real Estate, Real Estate News
hiDue to the current condition of the real estate market, many would be buyers are renting to be on the safe side. But in this market, renting does have some pitfalls.
With the onslaught of foreclosures many renters are losing their deposits and their rent money as properties are foreclosed. Now more than ever renters need to do their research to make sure they are not being cheated of their hard earned money. First question they should ask a landlord these days is if they have a mortgage. They should find out if they are behind on their mortgage or if the mortgage company has started foreclosure proceedings.
They also should find out if the person renting them the home actually owns the property. Some owners are just mailing their keys to the mortgage companies and abandoning their homes. Some unscrupulous individuals see an empty house, change the locks and try to rent them before the bank takes over.
They also should check the county records to find out if a Lis-Pendens has been filed against a property. A lis-pendens is a notice to the property owner that a lawsuit will be filed against the property.
For renters in properties that are foreclosed, the first notice may come in the form of a real estate agent or other representative the bank who will knock on their door and offer them $500 to return the keys and vacate the premises. If they don’t accept the first offer they will get two more chances to receive cash and vacate the property. Make sure you get proper identification from the bank’s representative.
Upon their third refusal, the bank will seek an eviction notice and the fourth visit will be from a sheriff and a moving crew will force them to vacate the property and place their belongings on the public sidewalk for everyone to steal. The worse course of action in this situation is to ignore the warnings.
If you have money for first, last and one month deposit, you may have enough money to get an FHA mortgage. In a time like this you may be safer owning than renting. Next time you consider renting, you may want to contact a reputable realtor and mortgage broker to find out if you qualify to own .
” If you have money for first, last and one month deposit, you may have enough money to get an FHA mortgage. ” What a great statement .
Not only that, but also you will be able to deduct your mortgage interest payment from your taxes as opposed to your rent payment.
For borrowers with basically no savings but with steady proven income, this program is the best. Buyers can negotiate cost reductions by having the sellers contribute with 6% towards closing costs and prepaids. Borrowers can still put a down payment as low as 3% with no cash reserves requirements and gift funds are accepted.
FHA financing is great for buyers that have minor credit challenges but can substantiate their ability to repay the loan. This program provides safe financing options with flexible credit and income qualifying criteria.
Furthermore, if you are planing to rent as result of a recent foreclosure or short sale, please keep in mind that FHA might be your first option to get back into your own home and to accomplish that, you will have to discipline yourself to timely pay your rent just as if you would pay your mortgage for the next 18 to 24 months.
To get more details on specific answers on how FHA financing could work for you please do no hesitate to leave a comment on this blog.