Rent Back House Option Benefits Sellers And Buyers

With the ongoing sub-prime mortgage crisis, more and more homeowners are finding themselves in over their heads. Saddled with an adjustable rate mortgage that has already or soon will reset at a much higher interest rates, they are unable to afford the new payments and begin drowning in debt. The available options are few: bankruptcy; defaulting on the mortgage; or even walking away from the house and letting the bank have it.

Thank goodness there is another way. You can choose the "rent back house" option. This is how it works. 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". Either plan may work well for you.

With a rent back house agreement, everyone wins. The seller is able to remain living in the residence and doesn't have to open his life to the disruption of moving. The buyer adds a property to his list of assets, receives the monthly income of rent payments, and has a ready-made motivated buyer who will repurchase the property when they can.

This program however, would not only benefit those people who knowingly got tricked into getting an adjustable rate mortgage, or even those who knew exactly what they were doing, but many other people stuck with a bad loan due to the many reasons banks are allowed to do such things. Some of the reasons might be personal problems such as getting divorced, unpaid medical bills, bills or loans going to collection or other legal matters.

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 are considering investing in this option, search under "homes on sale and rent back" or consult with a realtor yourself. This is, however, a "buyer beware" situation for you. Be sure you also have an attorney involved and that you thoroughly check out the buyer to determine if they are reputable.