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from: Let Buyer Beware: Foreclosure Buy Back Mortgage LoansOne of the biggest scams out there that a person involved in foreclosures might encounter is the foreclosure buy back mortgage loans. To be clear, there are some honest investors that offer this option too, but it is definitely a case of buyer beware.
You have to be certain you understand the terms of the buy back agreement so that you really do have an option to buy back the property as you assume is the case. Otherwise, the foreclosure buy back mortgage loans offered by some unscrupulous investors can be used to divest you of the home or place you in further debt.
The game starts when a person finds themselves in the foreclosure process. They are often targeted by reputable as well as dishonest investors trying to make a buck off of your predicament. While the honest investor might offer genuine foreclosure buy back mortgage loans, what the dishonest one will do is tell you one thing and have you sign something else entirely. So, be sure to pass any papers you sign by your own attorney if you are considering such a deal.
In the case of foreclosure buy back mortgage loans, you are generally required to sign the deed to your home over to the investor. In return, they might promise to pay off the outstanding balance and allow you to rent the property from them while you get back on your feet.
The problem is that once you sign the deed over, you've lost the house and the odds of you buying it back are pretty slim. They might have very restrictive terms that make it impossible for you to buy back the property or you have to buy it back for far more than you sold it to the investor for by allowing them to pay off your account.
Also, there are dishonest investors that might not pay it back and just use the remaining equity in the house with the deed to go out and get more financing for other deals, leaving you with the bill – if you remain listed as the owner of the house. Either way, the results of such deals are typically that the home owner is evicted, they are fleeced, or they end up buying back the property at a premium. If they really want that particular house and can find a reputable investor, then it might pay for them to do this deal, but it should be investigated thoroughly.
You should have your own lawyer present throughout the deal to review documentation and make sure your interests are being met.
Foreclosure Bailouts Loans News
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Loan modifications - reality or myth? - Examiner.com
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Bernanke Says Large Bank Bailouts 'Unconscionable,' Must End - BusinessWeek
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REAL ESTATE: Banks sharing the love? - Las Vegas Review - Journal
REAL ESTATE: Banks sharing the love? Las Vegas Review - Journal They recently received a foreclosure notice after the principal balance on a $4.3 million loan for the commercial property at 3530 E. Flamingo Road came due ... |
On the House: FHA alters borrowers' guidelines - Philadelphia Inquirer
On the House: FHA alters borrowers' guidelines Philadelphia Inquirer ... been depending heavily on the government for everything lately - from foreclosure bailouts to tax credits to push wary purchasers into home ownership. ... |
More homeowners are opting for 'strategic defaults' - Los Angeles Times
 Los Angeles Times | More homeowners are opting for 'strategic defaults' Los Angeles Times Plus, she said she was duped into an expensive loan. The way she sees it, big banks that helped fuel the mess all got bailouts while small fry like her are ... |
Loan problems remain a drag on area banks - Colorado Springs Gazette
Loan problems remain a drag on area banks Colorado Springs Gazette Rocky Mountain Chairman Doug McClure said the bank has agreed to some transactions that would reduce its loan problems and foreclosed real estate. ... |