How To Beat The Bank With A Sell And Rent Back Scheme

Posted by admin on September 7, 2009 under Sell and Rent Back | Read the First Comment

If you owe your bank more money than you can afford to pay, and you have a property that has good equity, with value worth more than you owe, then a sell and rent back scheme could be a lifesaver for you and your family.

With thousands of home owners in Britain faced with the prospect of their properties being repossessed, the sell and rent back possibility has attracted a huge amount of publicity. There are those who love it and those who hate it, but at the end of the day, nobody can deny that this is one really good way to beat the bank!

If you’re in trouble because you can’t pay your mortgage, there are companies like Beese Properties that can help you. So why not consider what they have to say? Chances are you’re looking for “another” solution because your mortgage lender can’t help any more. You’ve tried to sell the property through regular estate agents and there is so little cash around, nobody seems interested. The estate agents keep reassuring you, but you’re fast running out of time.

Generally the people who will be really happy with sell and rent back schemes are those who genuinely are about to lose their homes due to bad debt. They have usually tried every way to stall payments, but still can’t pay. So the mortgage debt keeps increasing. Banks and other mortgage lenders will help to a point, but then typically they break ties with their clients and bring in the legal guys. If you were in the business of making money out of loans and people couldn’t pay you, you would probably do exactly the same thing. After all, we all know that banks are not charitable organisations!

By selling your property and then renting it back, you get a cash injection that will get rid of the mortgage and, providing there is sufficient equity in the property, get rid of other debts as well.

Like all deals, sell and rent back agreements are negotiable. Beese Properties will usually give clients several options and they then decide which is best for them. If you want the chance to buy your home back at a later stage, they will negotiate a purchase price when you sell. That way if you’ve sold below market value prices, you will be able to buy back below market value as well.

Another advantage with these schemes is that there are no estate agents’ fees or expensive lawyer’s bills.

Here is a checklist of what you need to know before you sell and rent back.

How much you will be paid for the property?

How much will be left over once the mortgage has been settled?

How long you will be allowed to remain in the house after the sale?

What rental you will be charged, including increases over a five year period?

Whether there will be any restrictions in terms of use of the property (in other words can you continue to treat the property as if it is still yours)?

What your obligations are in terms of the property in regard to maintenance (in other words will the new owner fix leaks and other problems)?

Will there be a restriction of sale agreement that can prevent the new landlord from selling the property after a short period of time, a year for example?

How long have you got to buy the property back?

Do you know how much you will have to pay for your home if you do decide to buy it back?

Once these questions have been answered satisfactorily, and you’ve made the decision to go ahead, you will be able to sit back a heave a great sigh of relief.