“Rent to own” forclosures?

[Artifact]

I am seeing more things like this come up on Craigs list. I am definitely getting more skeptical as I get older, but I can’t help but feel there is some not fully correct with this.

I am just curious what people think of these offers, I personally am not interested in getting into one of these, just curious; will we see more of them? Are they potentially a good deal (once prices are lower)? Are they just another scam trying to take advantage of the market?

http://sandiego.craigslist.org/apa/372509418.html

T

[Anonymous]

The statement “and the home will eventually become yours” is weird to me. I doubt that it would happen with a $1500 per month payment. So would there be a point where this would “reset” into the renter assuming the full mortgage and seeing a increase in payments? Would a new mortgage need to be written up at that time? It seems fishy to me as well.

[Anonymous]

The statement “and the home will eventually become yours” is weird to me. I doubt that it would happen with a $1500 per month payment. So would there be a point where this would “reset” into the renter assuming the full mortgage and seeing a increase in payments? Would a new mortgage need to be written up at that time? It seems fishy to me as well.

[bsrsharma]

How does this work?

Can I just walk out anytime i.e. change my mind to “Not Own” it? If yes, then it is just a indefinite “lease”; If not, it is a major pain. Either way, if there is no mortgage in your name, nothing can stick to you if you decide to walk out. If they don’t ask for a down payment, I should have no issue signing up.

[bsrsharma]

How does this work?

Can I just walk out anytime i.e. change my mind to “Not Own” it? If yes, then it is just a indefinite “lease”; If not, it is a major pain. Either way, if there is no mortgage in your name, nothing can stick to you if you decide to walk out. If they don’t ask for a down payment, I should have no issue signing up.

[gn]

The following is likely to be true:

1. The current owner is “upside down”. That is, the loan amount is more than the market value of the house.
2. The current owner just wants to “walk away” without having his credit record being damaged by a foreclosure.
3. He needs someone to bail him out by taking over the loan.

The thing is: you can easily go out & buy similar house for less than the loan amount of the above house.

[gn]

The following is likely to be true:

1. The current owner is “upside down”. That is, the loan amount is more than the market value of the house.
2. The current owner just wants to “walk away” without having his credit record being damaged by a foreclosure.
3. He needs someone to bail him out by taking over the loan.

The thing is: you can easily go out & buy similar house for less than the loan amount of the above house.

[Author]

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