A recent study estimates that 47% of foreclosed properties are still occupied. It may be shocking for some to see such a high percentage of foreclosed homes still being occupied… but we’re not surprised!
What most people fail to realize is that banks aren’t in the business to own homes.
A Bank’s First & Foremost Priority Is To Loan People Money.
Foreclosure on a property forces the bank to take ownership of the home until they’re able to sell it on or get their money back.
However, what most banks discovered might surprise some people, but realistically it makes sense. When a foreclosed house becomes vacant, the property becomes far more likely to fall into disrepair.
To discourage vandalism and keep the house in tip-top condition, often, the bank would prefer to let you remain in the property – even after the foreclosure has begun and you have stopped making payments.
Stories about banks “abandoning” properties and letting people live rent-free after foreclosure are circling in the media. People are allegedly avoiding house payments for months or even years. Man, that sounds too good to be true, right? Otherwise, we’d all be following suit. (wink)
There’s got to be more to it than that?
It’s clear that in these situations, something has gone wrong, and mistakes were made (on the bank’s side). No bank would deliberately forget to collect payments.
But, banks can slip up. It’s happened before. So, you might get lucky! But, wait a second. It’s not exactly legal to avoid payments that you owe. Even if no one chases you, you can still get in serious trouble.
So, why are so many foreclosed homes occupied?
Remember, no one wants the house to be vacant. Vacant homes are easy targets for vandalism and crime.
Letting homeowners remain in the property is actually in the bank’s best interest since it helps the bank maintain the value of their investment. But you should know that because of how foreclosure laws in Florida are structured, banks may ask you to leave while wanting you to stay.
However, there are a few perfectly legal ways to remain in your home, even after foreclosure.
How To Stay In My Home After Foreclosure In Miami
Not all these options are available (depending on your situation and your lenders), and you’ll need some expert advice along the way to help you get through.
1) Wait it out. Honestly, this is a pretty bad option, but it seems to be increasingly common. You definitely shouldn’t run away and abandon your house when the first Notice of Default shows up. Don’t give up at the first sign of difficulty. Remember that this process can take months or even years. Wait it out. This doesn’t mean: wait until the sheriff shows up to evict you to start packing up your stuff. Just don’t assume the only option is to get out fast.
2) Go to court. In very rare cases, judges are granting stays and delaying evictions. This is really only a valid option if you (and your attorneys) can prove that the bank has neglected a legal requirement during the foreclosure process. Going to court against banks with lawyers is very difficult. However, during the past few years, a lot of fraudulent behavior at banks has been uncovered. We may start to see an increase of homeowners relying on the courts to prevent foreclosure. But don’t forget that it can be costly and time-consuming; even if you’ve got a perfect case most people don’t stand a chance.
3) Propose a move-out bonus. Often buyers of occupied foreclosure properties spend thousands of dollars on lawyers and other costs of eviction, so why not save everyone time by taking some of that cash for yourself? It’s known as “cash for keys.” It sounds a little greedy, but it can help everything run smoothly. Plus, you’re technically doing both the banks and the buyers a favor by not abandoning the house to squatters.
4) Rent it back. It may sound crazy, but some banks are willing to take on previous homeowners as tenants in their property. It’s only a short-term fix, as they will want it in writing that you will vacate the premises as soon as they find someone to purchase the property.
It’s terrific that you’re reading this page and exploring your options. Our goal is to help homeowners like you to find creative solutions. We can’t help everyone, but we might be able to help you.
We buy local Florida Florida houses like yours from people who need to sell fast.