Can Your House Get Foreclosed If You Make All The Mortgage Payments On Time?
Entering into a home mortgage agreement is many people’s dream, of which mortgage foreclosure is the corollary nightmare, but at least foreclosure is not a surprise. When you fall behind on mortgage payments, your mortgage lender lets you know immediately, and there are plenty of actions you can take before your case gets to the stage of the bank foreclosing on your home and sheriffs’ deputies evicting you. It is usually possible to enter a forbearance agreement with the lender, or even permanently modify the terms of your mortgage loan, so that your monthly payments are lower. Even if you end up having to leave your dream home, at least you have some time to decide where you will go instead. Being taken by surprise that your house has already been foreclosed and you are now out on the street, even though you thought you were current on mortgage payments, is an even bigger nightmare. A Boca Raton foreclosure defense lawyer can help you avoid this terrible situation.
When Rent to Own Arrangements Are Not What They Seem
A recent report by Jennifer Ludden of NPR highlights the dangers of alternative home mortgage arrangements. People who cannot otherwise qualify for home mortgage loans often enter mortgage-like agreements with homeowners instead of dealing directly with the bank. These are often called direct to seller arrangements or rent to own arrangements. In these arrangements, the buyer makes monthly payments directly to the homeowner with the understanding that the buyer is building equity in the home instead of simply paying rent. The seller does not transfer the title of the house to the buyer until after the buyer has paid the full purchase amount that the parties agreed. Buyers enter arrangements like these because they are less expensive and easier to get than a mortgage loan from a bank.
In the best-case scenario, the buyer gets ownership of the house after making payments for many years, but until they have paid off the purchase amount in full, they are at the mercy of the seller, and they have little to show for it. The worst-case scenario happens when the seller still owes money on a mortgage loan for the house, but when the buyer makes payments to the seller, the seller keeps the money instead of using it to pay down the mortgage balance, and the house eventually goes into foreclosure. Sometimes the buyer has no idea that they are in danger of losing the house, because they have been making all of their payments on time. Even if you cannot qualify for a conventional home mortgage loan, working with a lawyer before and after you enter into a rent to own agreement is the best way to prevent problems like these.
Contact a South Florida Foreclosure Lawyer About Rent to Own Fraud
A South Florida mortgage foreclosure lawyer can help you if you have run into trouble with a rent to own agreement with an unscrupulous seller. Contact Nowack & Olson, PLLC in Boca Raton, Florida to discuss your case.