This situation of families renting a home, and sending rent payments to the owner, and Owner is not paying the Mortgage with the rent check is becoming more and more prevalent.
The homeowner has found that they can't afford to send the rent check to the bank to make the mortgage payment anymore (for various reasons)--owner's job loss, or income reduction.
Just this week I've had 2 clients who were in this predicament.
The 1st client I've been working with is a tenant in Alexandria Virginia. The owner of the home they're renting told them to stop paying rent because he doesn't own it anymore, so they stopped paying rent. In October 2010 a Realtor knocked on their door and had a newspaper article in hand stating that this home would be auctioned at the courthouse. The sale took place at the courthouse steps, but it didn't sell. However, now it's January 2011, and they are still living in the house....I told them it's only a matter of time before they will get evicted from that house (without being notified). The Owner of the home will be notified, but he won't notify the tenants because he believes they have already moved out of his house.
Both husband and wife work at the Pentagon, and make great money, but have never bought a house before. They were hoping to receive an eviction notification, which they would present to the Military and have their Move Paid for by the Military Program. Of course, with the vicarious position they find themselves in, I explained to them they should be less concerned about collecting money from the military to pay for their move to another house, they just need to get out. If they don't, they may come home and find all of their stuff by the curb. They agreed with me, and are now actively pursuing their home buying efforts.
They realize that with the great income they're bringing in, there is no reason why they shouldn't buy a home. As a matter of fact, here are 10 good reasons why you should buy your own home instead of rent. Top Ten Tax Deductions you can use when buying your own home . . Read More Here
They qualify on just his salary for up to $375,000. They have decided in order to get a really nice house for the money, they would like to live in Woodbridge, Lake Ridge, Dumfries, Lorton, Springfield, etc. This way their commute would be straight up Interstate 95 to the Pentagon.
Their options are endless. My lender had them pre-qualified in a day. Feel free to call Larry Justice at 703-980-2051 with McLean Mortgage Corp to see if you could be pre-qualified to buy a home. If not, a lot of my buyers have found Larry and his partner Hank Bingham at 703-989-5643 very good with going over credit reports and helping to clear up issues that are negative on the credit reports. Larry Justice VA License # is MLO-4326VA. To confirm Larry's affiliation with the Mortgage Company type his name in the enclosed Company Directory and you will be able to find him there McLean Mortgage Corp
The 2nd client that just found me through my Activerain Blog that I wrote on Investor Rent to Own is in a similar situation, but not as severe as my 1st client. The 2nd couple with 5 kids in Ashburn are renting a house for $3,100 per month, and the owner has a ratified contract to sell the home as a short sale. They will need to wait for the bank to approve the short sale, but in the meantime, my clients need to find another place to live because once the Bank provides approval, 30 days after that the new owner will need to move in.
According to my initial conversation with this couple, they don't believe they can purchase due to their current credit scores, etc. In this kind of a situation, I am experienced in finding Rent to Own properties for those clients who have credit issues now, but have good income. Sometimes all that is needed is a few months before they will be able to get their credit score up to where it needs to be to qualify for the loan. Some people will need more time (maybe as much as 2 years). There are no set rules when it comes to Rent to Own -- the terms are whatever the owner and tenant can agree to. There are still some homeowners who are not in financial straits -- they have the flexibility to agree to a rent to own.
If you would like to know more about Purchasing a Home Please fill out some basic information Here
I am able to help you with purchasing a home in Washington, DC and Maryland as well (through Referral within my Broker's office).