Protect Yourself From This Rent To Own Scam

Renting to own sounds like the perfect solution to many people who might not be able to purchase a home otherwise. Rather than having to come up with a down payment which is far more than a lot of us are able to scrape together, especially during a recession where banks are less willing than ever to extend home loans, renting to own allows consumers to buy their home at a price comparable to what they’re already paying in rent.

Unfortunately, one of the unforeseen consequences of the recession is a growing number of rent to own scam operators looking to fleece unsuspecting would-be home buyers. There are a lot of different types of rent to own scams out there and it’s important to know what to look for in order to avoid being taken in by one of these criminals: the following is one of the most common to watch for.

Given the nearly record high number of foreclosure listings nationwide (and definitely record high in some states), there are a lot of unoccupied homes on the market and a shortage of willing buyers – the ideal conditions for an ambitious criminal to run a rent to own scam. These scam artists will gain entry to a foreclosed home and begin showing it to prospective buyers while representing themselves as the owner of the property. At least for a while, it may seem that everything’s fine, at least until the owner of the property finds a buyer to show it to or lists it with a realtor and the would-be rent to owners are out on the street again.

There are a few signs of this scam to be aware of; the property is usually listed at a price which is substantially (some may say suspiciously) below market price. There may also be some obvious signs of forced entry, with the scam artist mentioning the locks needing to be changed, etc.

There are two things that prospective home buyers can do to protect themselves from this scam. One is to use a reputable source like RealtyStore.com, where rent to own scams are already filtered out by the website's staff. The other is to consult your county clerk’s office of property records in order to make sure that the “owner” trying to rent you their property is who they say they are or if they’re running another rent to own scam.

The Five People You Meet At Your Open House

An open house is the standard when it comes to real estate showings. (An open house can be organized by the listing agent, or by the owner him/herself in the case of a for sale by owner house.) An open house means that anybody interested in the property can come on down if they know of the showing through either a print ad or an online ad.

Still, not every individual who stops by is actually a potential purchaser, which is something that any skilled buyer agent will notice. In fact, you could even say there are 5 kinds of people who stop by such a showing:

The Actual Buyer

This is a person who is actively involved in the home-purchasing process. Either way you cut it, this type of individual is either testing out the real estate market or his heavily committed to taking action sometime down the road. If you are selling your property, this is the person with whom you want to connect the most.

The Close-by Neighbor

This neighbor is not at all interested in buying up your property. In fact, a better term for this person might even be the nosy neighbor. This individual is only going to show up at your showing for his own ulterior motives. This could involve comparing your property to his, seeing how much privacy he has from your backyard view, and even seeing what kind of a person you are!

Agents Investigating the Showing for their Clients!

It is a known fact in the real estate world that some agents actually scope out properties for their own clients. A lot of agents do this, and, for the most part, they can be decent and polite while essentially acting as a spy of sorts for their clients! Occasionally, there are even rude agents who will say misleading things about a property while loudly 'talking to their clients' on the phone!

Agent who lost the Listing

Notice a guy or gal at your showing with a weird-looking disguise? This is that agent with whom you previously spoke about listing your property, but who lost the listing when you chose some other agent to do it! It is not uncommon for such an agent to come by and see if you took any of his or her suggestions during your showing.

A Prior Owner

Sometimes, a previous owner of your property that you are now selling is going to pop up when you hold your showing. This can be a decent time for you to reminisce with said owner about their own experiences and memories in your home. Of course, such a seller is not going to want to buy your home, though!

Own to Rent: Not A Good Choice

Bank of America is trying a new approach to help people get through the recent economic troubles, but where rent to own housing was such a success, the new own to rent housing is looking like it’s not as popular – and certainly not the kind of thing that a wise investor would consider!

The housing market has been a bit tight recently, and the truth is that millions of people around the country have felt the crunch as the economic situation slowly wobbles its way to recovery after the Great Recession of 2008. Though many believe that the situation has been left far behind, a closer look at the financial markets shows that things have only begun to improve in the last few months. While the housing market has taken a turn for the better, things haven’t quite yet stabilized.

Bank foreclosures have been higher than normal in the last few years, and the rent to own housing arrangement has proven to be a boon for all. Many people were able to live in homes that they currently were renting, but they were able to tack on a rent premium that went towards the closing costs of their new home once their rent agreement expired. This was a huge help for people who were recovering economically, but who were unable to purchase their dream home at the moment. They could rent the home, and thus put aside towards buying it in the future. Most of these rent to own leasers ended up with a bit more equity on their home than they expected.

However, the new Bank of America initiative is actually the opposite, and the new own to rent option is taking a lot of flak – both from RealtyStore.com experts and from real estate professionals around the country.

Where rent to own houses enabled people to rent houses in order to buy them from their owners, own to rent housing is exactly the opposite. The owner of a house at risk of bank foreclosures is actually able to sell the deed to the bank, but they will be able to continue living in their home. They will basically rent the home from the bank that was about to foreclose on them, and they will no longer be the owner of their house.

No doubt you can see why this is such an issue for so many. While the rent to own option encouraged people to move into the house that they would buy within the next few years, the own to rent option is basically the bank saying, “Sure, we own this house, but we’ll have pity on you and let you continue living in it.” The house that once belonged to the occupants is now owned by the bank, and they are living in a home that they now have to pay rent for.

The bank is claiming that this option will allow those that are suffering from economic hardship to be able to continue in their current homes, ensuring that they aren't evicted just because they are unable to pay the mortgage on their homes. The option offered by Bank of America is available to those that are more than 60 days behind on their mortgage payment, as well as for those that owe more on the mortgage of their home than they have in home equity.

This option has received mixed response from the public, though the majority of experts agree that this own to rent option is not the best choice for most. While it does give those with economic hardships the ability to continue living in their homes, it often means that they will continue to live beyond their means in a home that they were unable to afford in the first place. The bank has bailed them out, but they will continue to dig themselves deeper into financial holes.

On this topic, Andrew Goodwin of RealtyStore.com commented, “While this allows both lender and borrower to avoid foreclosure proceedings, it's sad to see people deprived from their home ownership dreams. We'd encourage banks to consider more of a lease option approach, where the now-tenant would have an option to buy his/her home back in two or three years through a balloon payment, essentially a second down payment."

How do I know if I have a good real estate agent?

Buying cheap homes can be easy or hard, depending on whether or not you have a good real estate agent who is working with you. In fact, your experience with regard to buying or selling a home rests a lot on the kind of quality of the realtor with whom you are dealing. A lot of people have asked themselves if their agent should be doing this or not. To settle this once and for all, just read on to find out if your realtor is behaving in a legitimate way or not.

First up is credibility. A good real estate agent will possess oodles of credibility, which is mainly measured by way of how many years experience he or she possesses in terms of showing and selling houses. Ideally, it is also recommended that the agent have experience in all sorts of real estate markets.

Next up are the right credentials. You can be assured that your realtor will perform better if he or she has any of the following letters after his name: SRES, CLHMS, ABR, CRS or GRI. A realtor with these credentials will usually provide a better service than one without.

Good communication—there is simply no substitute for it, and it is yet another hallmark of a good agent. Your agent should possess good communication, which includes returning your e-mails and your phone calls in a prompt and efficient manner.

If your agent has a lack of education, then that is problematic because it raises questions about his commitment to keeping himself or herself informed of all the trends in the real estate market. Beware this type of agent!

One way that your agent can ignore your needs is if he or she keeps showing you properties that are always beyond your means. Such an agent is not looking out for you, and you should part with him or her quickly.

Finally, an agent who does not work full-time is one to be avoided, too. An agent should not be working so little that he or she can’t give you full attention.

Houses for Rent in Cleveland TN

In the foothills of the Smoky Mountains, the city of Cleveland, Tennessee is located within easy driving distance of Chattanooga. While it’s fairly easy to find houses for rent in Cleveland TN, you may be wondering why you should consider going with a home in this area.

Cleveland makes a highly desirable relocation destination for those looking for many reasons. Those interested in houses for rent by owner will find that the city not only offers natural beauty, but excellent business opportunities, affordability and more.

The city has their own Economic Development Council that focuses on working on the economy’s diversity and financial growth. Recently, the city has been recognized nationally for successfully creating new jobs, preserving current jobs and keeping a strong economic base for development in the future. Various Fortune 500 companies are located in the city, including Honeywell, Duracell USA and Maytag.

Of course, the reasons to consider houses for rent in Cleveland TN go beyond just economic reasons. The city offers many recreational and shopping options to residents and visitors. Those who move to the area can enjoy the many recreation, water and park areas. A few of the recreational choices residents enjoy include biking, boating, fishing, rafting, golfing and more. Plenty of shopping is available, as well as excellent dining options.

The price of renting a home is also reasonable, which makes the area worthy of consideration. With low rental rates, business opportunities and a stable economy, choosing houses for rent in Cleveland TN is an excellent choice for couples, families and other homebuyers.

Why Young Families are Attracted by Rent to Own Homes in San Diego

San Diego offers many benefits that attract home buyers and renters of all ages and income levels. However, the area is especially attractive to young families. Many families are taking advantage of rent to own homes in San Diego for a variety of reasons.

Education is Important to Young Families

For young families that home children of school age, education is definitely important when they decide to find a rent to own apartment. Families want school systems that offer a great education, which they can find within the San Diego area. Public schools in San Diego have hired more teachers, lowering the ratio of children to teachers to below 20 to 1. Education is very important and families are offered many choices, with excellent private schools to consider, along with the public school systems.

Job Opportunities Offer Financial Security

Another reason young families are attracted by rent to own homes in San Diego is because of the job opportunities in the area that offer financial security. Parents are worried about providing for their children, this area has a job market that is growing, and it is predicted to continue its growth over the next 10 years. The economy is still solid in this area, making the city an excellent choice for families interested in relocating to an area that offers better financial stability.

Low Crime Rates

Most young families want to ensure they live in areas with low crime rates to keep their children safe. Once again, San Diego delivers. Crime rates have been falling in recent years, making this city one of the safest within California.

With a great educational system, job opportunities and low crime rates, it’s easy to see the attraction of rent to own homes in San Diego for young families. Families can enjoy a wonderful area that provides their children a great education in a safe environment while making sure they stay financially afloat.

Rent to Own Homes in Midland TX Offer Great Deals for Homebuyers

When you’re looking for a new home for your family, you definitely want to find a good deal. After all, the real estate market still hasn’t completely recovered and you want to make a wise investment. If you’re interested in relocating to the state of Texas, rent to own homes in Midland TX offer excellent deals to homebuyers today.

The median cost of homes in the Midland area is about $194,000. While that may seem a bit expensive, it’s important to note that home appreciation is up in this area. In many areas across the country, home values are dropping drastically. However, this isn’t a problem in Midland, which is why prices are a bit higher than other places. With homes appreciating more than 13% within the past year, investing in a home is an excellent option.

Going with houses for rent to own in Midland, Texas offers homebuyers the ability to lock in the current market prices on the home. A lease option contract allows you to rent the home for a specified period of time, making the final purchase when the lease period is up. Some of the money you pay will go towards the purchase price. Since home values seem to be rising right now, you can lock in today’s price on the home, which can save you a significant amount of money on rent to own homes in Midland TX.

While rent to own homes are a nontraditional method of purchasing a home, they do have much to offer. You can find a home for an excellent price, lock in that price and then work on getting your finances in order to make the purchase. When you’re ready to begin looking for options, the search engine at RealtyStore.com can offer a great resource.

Foreclosures Up--Hope Down--Deliberate Action or Indication of Recovery?

A report in late June revealed that the foreclosure rate has taken a serious jump, landing about 54 percent up from where it sat a year ago and more than 29% growth between April and May of this year.

Foreclosure notices in Illinois last month topped 16,318 in default notices, auction sales, bank repossessions, and other sale notices. Illinois, as well as the southwestern United States, including Nevada and Arizona are suffering as well with the top three repossession and foreclosures in the nation. The two top metro areas which are hit are Chicago and Los Angeles.

In May of this year there were more than 109K foreclosure listings, and this is twelve percent over what was national a month earlier. The AP says that if the last five years are any indication of what's happening, more than half of the houses in the United States are in foreclosure or will currently be foreclosed on. This number would seem to indicate that the Obama administration's claim that the housing market is in recovery or is slowly recovering may be premature, if not completely wrong. Major media, quick to dive to the defense of the Obama administration and claims of a housing crisis recovery may be left with a bit of egg on their faces if they continue to follow the Obama path.

The sudden increase in foreclosures and repossessions is said to be no accident, but the resultant wave of a policy which was deliberately pursued by the Obama administration on behalf of those who were well off financially. The AP notes "Foreclosure activity, as measured by the number of homes receiving foreclosure-related notices, slowed sharply last year as banks grappled with allegations that they had been processing foreclosures without verifying documents.”

Is this an indication that the houses will soon be on the market to be snapped up by a recovering economy, or is it an indication of things to come?

Stabilizing the New Jersey Housing Market

The New Jersey State Assembly is attempting to stabilize the local housing market with bill A2168. Among other things, it would allow the formation of the New Jersey Foreclosure Relief Corporation for five years.

Under bill A2168, municipalities would have 45 days to evaluate bank foreclosures in their area. They could opt to purchase them as designated affordable housing (and receive a 2 for 1 credit against the required number). Or they could allow the corporation to purchase the home, locking it in as affordable housing for 30 years.

Additionally, the corp. would be able to sell bonds for capital to buy other New Jersey bank foreclosures for sale at market prices.

While most legislators, lenders and realtors back the measure, state director Steve Lonagan leading the conservative Americans for Prosperity group are fighting it, saying it will increase crime, further reduce home values and increase property taxes.

One of the sponsors of the bill proclaims that a scare tactic. Across the nation statistics show that unoccupied homes are more likely to cause an increase in crime and pull down home values, rather than ones occupied as affordable housing.

Cheap Homes In Florida Attract Snowbird Buyers

In the housing market, one man’s ‘hurricane’ is another man’s windfall. This scenario is playing out in the resort areas of Florida. Heavily salted with second and vacation homes, these areas were among the hardest hit during the collapse of the housing market in 2007-8. Owners of these homes walked away from them in droves, many from other countries.

Although prices have started to rise in recent months, the prices are still so far below their pre-collapse highs, homes can be had for one-half to even one-third of their 2007 asking price.

The benefit of the rise and faster turn around on these homes is that now there is financing available for them. During the crisis, lenders would not even look at a mortgage for a second home.

Bank foreclosures or short sale vacation homes are becoming a larger portion of the real estate pie, in some areas outselling primary residences. Small investors are feeling the urgency to find their windfall now, as liquidity and financing loosen and before the corporate conglomerates snap up all the bargains.

(See more at the Orlando Sentinel)

Watch for red flags (and leaky roofs)!

The most important thing to remember about buying a home is to look at more than one place.  Buying a home is a big step for anyone.  It is a good idea to make a list of everything you are looking for in a house.

No matter how exciting it is to see that for sale sign and cheap homes on thatforeclosures list and that it may all look wonderful, it may not be as perfect as you think!

Cultural differences can make homebuying an adventure

This world is a melting pot of different cultures and that can translate into home ownership through foreclosures as well.  Sometimes people who are from a different country can live in a way that is not seen as normal in the United States.

Though hard work does have its rewards, sometimes a good deal with cheap homes might be a way to save money and you may get more than you bargained for!

Changes can cost a lot

While building your own home is exciting, it is important to make sure that you meet up with the contractor that you hired.  It is important to discuss the layout of the house in detail.

The reason for the contractor is to make sure you get everything you want because making changes later on for a sudden change of mind about something can cost a lot of money and delay the completion of the home.

Rent-to-Own – A Bad Deal for Appliances

Purchasing furniture and appliances can be an expensive endeavor. For this reason, many people end up deciding to go the rent to own route. It often seems like a better deal to pay a monthly payment rather than paying out several hundred dollars at a time. However, is rent to own really a good deal on appliances and furniture?

Rent-to-own is not a good deal for appliances,
because they end up costing you a lot more.

In reality, renting to own your appliances can become very expensive, fast. Often you’ll be offered a deal that looks great. That washing machine may only cost you $20 a week. However, when you start adding up all the payments and the amount you pay in interest, you can easily pay more than double for that appliance. For this reason, many people refer to these purchases as rent-to-own scams.

While many people are realizing that renting to own is a horrible deal when buying appliances, they often think that renting to own a home isn’t a good deal for homes. They look at these options as rent to own fraud. However, while you don’t want to buy appliances or furniture in this way, rent to own can actually offer you a good deal for homes.

What makes renting to own a home so different from the rent to own scam of appliances? When you rent to own an appliance, you often end up spending double what that appliance is really worth. However, when you decide to go the rent to own route on a home, you aren’t wasting money – you’re actually saving money. Instead of getting a bad deal, buying a home through a lease option agreement is actually a great solution for those who want to buy a home while they are trying to raise their credit or build up the down payment on the home.

Rent to own homes offer several great advantages. One top advantage is being able to occupy the home right away. Instead of having to wait to move in when financing a home, you can get into the home right away and then work on getting everything in order so you can purchase the home.

It’s much easier to qualify for rent to own homes as well. There’s no need to worry about rent-to-own scams here. Even with a lower credit score or a debt to income ratio that needs to work, you can still work on buying a home when you go this route.

As you live in the home and pay rent, you can be building up money towards that down payment you need to make. Often the money you pay can be put towards the down payment amount, which really makes this a good deal for homes. Also, if you need to clean up your credit a bit to get the financing you need, you have time to do so when choosing this option.

Of course, there are a few pitfalls to keep in mind as you’re considering the rent to own option. First, you may pay a sales price that is just a bit higher. You also won’t get a deduction on interest that you would get with a mortgage.

While there are a few pitfalls to consider, overall renting to own a home is a good deal for homes. You won’t get scammed and lose a huge amount of money. You can work towards your dream of owning a home while making sure you don’t waste money.