Foreclosed-On Homeowners Turned Renters
Cited: Realty Times
Allowing foreclosed homeowners to remain in their homes as renters is a plan that first surfaced a couple of years ago and is gaining greater popularity today. “The basic point is you’re recognizing an unusual situation so you’re temporarily changing the rules on foreclosure,” says co-director of the Center for Economic and Policy Research, Dean Baker, who first proposed the plan. According to Baker, nothing else seems to be working in foreclosures are on the rise.
“As it stands now, if I hold the mortgage on a house and the person hasn’t met the payments, I go to the judge and say ‘Look this person hasn’t met the payments.’ The homeowner is given a certain number of days and, if payments aren’t met by then, the house is mine. I throw [the homeowner] out on the street,” says Baker. Baker’s plan proposes to change the rules of foreclosure for a limited period of time.
“Mortgages issued 2002 to 2006 or 2007, whatever time period we want to put in there. For those mortgages we’re going to recognize the unusual situation and say that if I want to foreclose on that person, I have to give [the homeowner] the option to stay there as a renter,” explains Baker.
The length of the rental period would be determined by Congress if the proposed bill passes. “My view is you want it to be as long as possible — seven years or 10 years — a lot of people wouldn’t take advantage of that whole time but the point is to give people substantial security in their home so they can stay there for a period of time as renters, paying the market rent. They’re not getting a subsidized rent,” says Baker.
The plan also binds buyers of the foreclosed property to commit to allowing the former homeowner to remain as a tenant for the rest of the guaranteed period. According to Baker, the important thing to note is the many benefits that this plan can bring for neighborhoods and property owners in those areas as well as those facing foreclosure.
For those who are looking to clean up . . . One professional cleaning service outshines other professional home cleaning companies because of the importance they place upon customer satisfaction. They pride ourselves on their Northern VA cleaning services and are committed to their professional care system used by each and every one of their maids.
“The absolute worst thing you could have happen for a neighborhood is to have vacant properties and, of course, in a lot of these areas you have a lot of vacant properties. Banks often don’t care for them well. They don’t see to it that the grass is mowed, that broken windows are fixed or boarded up. Sometimes houses become crack houses or there are squatters there. So it’s the worst thing in the world to have a foreclosure and have a house sit vacant and in many places that’s exactly what’s happening,” says Baker.
But Baker says that this plan may actually keep people in their homes and also let them remain homeowners. “I think a lot of banks will suddenly get serious about modifying loans if the alternative is being a landlord for five years. So, I think it will keep more people in their homes as owners but certainly it’s also better to have a neighborhood that has renters in those houses than have them staying vacant.”
However, Baker says banks still may feel the loss. “There is a neighborhood effect that if you prevent foreclosures and keep homes occupied, [the banks] may actually benefit. But in any specific home, if [the banks] kept everyone else from foreclosing but they themselves got the right to foreclose, they’d probably be better off foreclosing and throwing the person out. So the banks weren’t happy about [the proposed plan],” says Baker.
And the public? Well, these matters can be very touchy. “When you talk about the bailout programs, the modifications that involve public 
money, it really breeds a lot of resentment,” says Baker.
Baker says, “You have someone saying, ‘Well, I’ve been paying my mortgage why should I subsidize this person who’s not?’” However, he says that’s not the case with the right to rent plan. Baker says that non-delinquent homeowners should understand that taxes are not being raised to support the plan.
According to Baker, the best thing about this plan is that it does not require any bureaucracy, just changing the rules. This gives millions of homeowners who otherwise could just be foreclosed upon with no recourse another option. This plan gives them something that they can hang on to.
______________________________________
My Take: I like this idea! It gives people the opportunity to stay in the home that they love instead of completely losing it. It is also possible that once they are able to, they could start buying it again at a later date. I see a lot of potential in this plan.
The main obstacle I can see is the banks; they always want their money now. If banks would stop to think like the average person does, you might actually find a bank with a heart. I know their main purpose is to make money, but the difference in the rental and mortgage payment can be written off as a loss did save some money in taxes. However, I doubt they will see that point.
Although, it does give homeowners, who are about to lose their home, an opportunity to stay in your home longer instead of getting a foreclosure. I know many homeowners would be concerned about their credit rating and how this would affect it. Another aspect that might be incorporated into it is the possibility of not ruining their credit so that when they are able, they could purchase a home in the future.
______________________________________
Other Resources
Driver Assistance
Dealing with agencies such as the Registry of Motor Vehicles can be frustrating, confusing, and sometimes difficult. A Massachusetts DUI attorney is familiar with RMV regulations and procedures as well as the laws governing ignition interlock devices, license suspensions and hardship licenses. There is no reason to struggle alone with complicated laws and harsh penalties when a MA speeding ticket lawyer can help.
Increasing Home Value
One stone manufacturer has achieved great heights in the stone business and is today one of the leading importers of finished products of granite slabs and granite tile countertops. They offer a wide range of material from premium onyx to quality discount granite slabs for sale, all at wholesale pricing. Carrying over 100 different colors in granite alone, they are the dealer of choice for contractors and the public.
Better Business Software
With CRM software, the leading provider of mobile workforce management and service optimization software solutions creates business value for service operations through higher levels of productivity, customer satisfaction and cost effectiveness. Unlike Bluefolder, they combined educational, implementation and support services with the best practices and its industry-leading solutions and drives service decision making across all levels of the organization.
House Hunting Made Simple
Have you been wasting your time driving around town looking for homes for rent? Well, stop wasting your time driving around town or searching craigslist or the newspaper for houses for rent! With one simple mouse click you can find the perfect house rental that you have been looking for. At this website you simply enter what you are looking for and every available home that matches your criteria will appear instantly on a MapQuest map as an icon. Mouse-over the icon to reveal a photo of the rental home along with basic details. Just click on the icon to view a complete profile about the rental home and watch a photo slide show.
Tags: Arlington cleaning services, bluefolder, cleaning Alexandria VA, crm software, granite slabs for sale, granite tile countertops, Homes for Rent, House Rental, Houses for Rent, Housing for Rent, MA speeding ticket lawyer, mass dwi lawyer MA oui lawyer, massachusetts dui attorney, massachusetts dui lawyer, northern va cleaning services, professional cleaning services fairfax, Rent House, Rent Houses, small business crm software, tile countertops
Car being scrapped for cash! Many countries already have this type of a program. However, the program in the US ended on July 30, only a week after it began because the money was gone. A week before, the government gave details of its clunkers scheme that was aimed at getting people to trade in their “gas guzzlers” in exchange for greener vehicles. Now the program may have an additional $2 billion to continue according to government. Congress is set to vote the first week of August.
approved dealers. Vehicles to be traded in needed to be drivable, less than 25 years old and have been insured and registered to their owners for at least a year.
The bill specifies that during the first year of the program, vouchers will be issued for the following amounts: