Foreclosure Crisis Case Study

Foreclosure “victims”? People can be victims of fires and floods. I think it is a stretch to call someone a victim of a foreclosure. When people face a crisis, they usually want to be warriors as opposed to victims. They are better served by empowerment as opposed to pity. Boomerang seems like a fun nickname though. I would stick with Boomerang Buyers. It has that double B as well as the root word BOOM. All foreclosures are not the same. Some deals were so bad that nothing would have prevented them from going sour. The no-down-payment loans with the teaser rates were so seductive. And who wouldn’t want to be a duplex owner with rental income instead of a single-family homeowner? And why not add an SUV and a fishing boat using an additional loan because the rates are so low? From a lender’s point of view, writing loans is the goal. If you …show more content…
Buyers will find a few enticing advantages. A poor credit score is often overlooked by sellers. It is a way to get to know the neighborhood and test out the longevity of a job before making the purchase. They are able to lock in a purchase price even if the home value increases. There are some pitfalls. The price of the home may drop in the next five or so years. The buyer pays a premium on top of the rent payment which is non-refundable if the sale never goes through. The owner could be foreclosed on and the potential buyer loses everything invested. The buyer may not be able to qualify for the loan within the time of the contract. There are also rent-to-own scams all throughout the country. This is where the professional is absolutely essential. This is a risky proposition at best. But as mentioned earlier, life is all about risk. The good thing about rent-to-own is that both parties are taking a good sized risk. Do the homework on a deal like this. Make a strong commitment to both saving and credit repair. Become a Boomerang