Rent Back House: Another Choice

More homeowners are aware that they may have bitten off more than they could chew with the ongoing sub-prime crisis. Those who chose an adjustable rate mortgage which either already or will soon begin at a much higher interest rate are suddenly unable to afford the new payments. Bankruptcy, defaulting on the mortgage or just leaving the house and allowing it to go back to the bank seem to be the only options available.

There is another way, fortunately. It’s called the “rent back house” option. In the simplest terms, the rent back house idea works like this: you sell your house and negotiate an agreement with the buyer to rent the house from them. The buyer even agrees to sell the house back to you, an additional arrangement sometimes called “sell and buy back.”

Rent-back agreements are a “win-win” situation to an extent for all parties involved. The seller stays in the house, which does not disrupt their lifestyle and is comforting. The buyer on the other hand, acquires a steady form of income and real estate and a possibly buyer once their financial situation improves.

This option not only serves those with a nasty adjustable rate problem, but a variety of people who need to get out of a mortgage situation for a variety of reasons. They may be going through a divorce which requires them to divide up the house’s equity, they may be facing critical debt problems, they may have a medical situation, or a variety of other circumstances.

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 suffering in the sub-prime mortgage debacle. They may declare bankruptcy, go into default, or walk away and let the bank repossess the house. 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“. Be sure you to get an attorney and check out the buyer to determine if they are reputable.

- Peter Shukla

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