Foreclosure Help: Charities Helping Homeowners Buy Back Their Homes
As mentioned in this post on home foreclosures, it looks like some officials in some parts of the country are finally coming to their senses when it comes to helping struggling homeowners stop foreclosure.
Like California, Boston is approaching the problem in a unique way. Nonprofits in the city are helping occupants buy back their homes, according to The Boston Globe article Nonprofits help occupants buy back homes.
Foreclosure Help: Spotlight on Boston
Following is essentially how it’s working in Boston. The bank/loan holder sells the property to the charity for its current market value. The charity then turns around and sells it back to the original homeowner. Because property values have declined steeply in the last couple of years, homeowners are often able ot buy their properties back at a fraction of the original cost, saving them hundreds — and in some cases — over a thousand dollars a month on new, fixed-rate mortgages.
Foreclosure Help: What’s the Catch in Boston’s Programs to Help Homeowners Save Their Homes
Actually, there are no “catches,” which implies that it’s too good to be true. However, there are guidelines that must be adhered to, ie:
(i) Financial Guidelines: They must meet certain financial guidelines. These are not traditional guidelines however. For example, excellent credit. Many times, the homeowner doesn’t have good credit. But, as long as they can prove that they can afford the new mortgage, these charities are willing to work with homeowners.
Their goal is to keep existing homeowners in their homes and prevent neighborhood blight. This is why they are willing to overlook bad credit in many cases.
(ii) Selling Restrictions: To ensure that homeowners who purchase their homes back from nonprofits at discounts don’t profit unfairly when they sell, the nonprofits require that homeowners share any equity appreciation.
Foreclosure Help Is Not for Everyone
This foreclosure crisis has caused many institutions to think creatively about how to solve this problem. It’s the ones who take forward-thinking actions like this who seem to be making the most progress.
In spite of creative financial finagling like this, not everyone can be helped. BUT, at least some communities seem to be getting smarter about solving the crisis — which in the end helps everybody. Now, if only more banks would get on board!
What do you think?
P.S.: Learn how to easily modify your home mortgage and put the stress of possible foreclosure behind you.
Copyright © 2009: Foreclosure Business News