According to a recent study, it is estimated that 47% of foreclosed properties are still occupied.
What most people don’t realize is that banks don’t want to own homes.
Banks are in business to lend people money. When they have to foreclose on a house … the bank is forced to own the house until they are able to sell it to get all or most of their money back.
We have uncovered that when a foreclosed house in Houston becomes vacant … the house is much more likely to fall into disrepair, and become devalued.
Often times, banks will prefer to have you on the property even after you have stopped paying your payments and foreclosure has started, as it protects against vandals and keeps the house in good repair.
There has been a lot of talk in the media about people living for free after foreclosure and even lots of stories of> banks “giving up” their properties.
In these stories, people avoid paying for their homes for months or even years.
Dude, that looks great! We all live for free. (wink)
Wait … it can’t be that easy, can it?
No bank purposely neglects to collect payments. The only way that you get to live without making any payments is when major mistakes have been made.
You may be the exception, and get lucky! It’s possible, and it’s happened before. However, it’s not entirely legal to avoid payments that you rightfully owe, and it can cause you serious problems down the road.
So why are so many foreclosed homes occupied? It is important to remember that no one wants the house to be un-occupied. Un-occupied homes are prone to vandalism, and attract crime.
Staying on the property can actually help the bank guard their investment, so it’s actually in the banks best interest to keep the property occupied. Due in part to the way that foreclosure laws are structured in TX, banks may ask you to leave while wanting you to stay.
There are a few perfectly legal ways to remain in your home, even after foreclosure.
How To Stay In My Home After Foreclosure In Houston
Not all of these options are available (depending on the situation). You will need some expert advice along the way to help you move through red tape.
1) Do nothing. Honestly, this is a very bad option, but it is becoming more and more common. You should never run away or abandon your property when the first notice of default arrives. Remember, the foreclosure process take months and sometimes years. It is never over till it’s over, so avoid giving up too early. On the flip side, avoid having the sheriff show up to pack up your belongings and evict you.
2) Go to court. In very rare cases, judges grant eviction suspensions and delay expulsions. This is only a valid option if you can prove that the bank overlooked a legal requirement during the foreclosure process. In recent years, there has been a significant rise in fraudulent behavior at the banking level – so we may see more and more people using the courts to stop foreclosure. Fighting with banks and lawyers is very difficult, expensive, and time consuming, even if you have a perfect case, the truth is that most people do not stand a chance.
3) Propose a move-out bonus, if moved out by a certain date. Also known as “cash for keys”, buyers of occupied foreclosure properties often spend thousands of dollars on attorneys and other eviction costs, so why not save everybody’s time and expense, and get paid in the process. This may seem a little greedy, but lubricating the wheels keeps everything running smooth. In addition, banks may be very interested in this option. An occupied property keeps vandals, and squatters away, helping to preserve the bank’s investment in the property, until they find a buyer to take possession.
4) Become a Renter. This may sound crazy, but some banks will allow you to rent from them for a short time, until they can find a more suitable buyer to take the property off their hands. One major drawback to this is that you will need to vacate as soon as a suitable buyer is found to purchase the property.
Depending on the circumstances, IE Builders may even be willing to purchase the property and rent it back to you.
We hope that we have provided a solid resource to help homeowners like you consider and know all your options.
Unfortunately, we are not able to help everyone, but we might be able to help you.
We buy local Houston TX houses like yours from people who need to sell fast.