In Case Your Real Estate Strategy Involves Rent To Own

Of course, most real estate books these days seem to promote “flipping”… you buy with leverage, you fix it up, you sell at a profit and pocket the profits.

If you thought you could buy, fix up, and in a pinch let people rent to own, you may want to check this out. I was surprised by the length of time these folks are going without paying a cent on their mortgage.

Usually you hear about people getting 90 days behind and they’re out the door. That is not true in some parts of the country. In the NY Times today you can see this headline: Owners Stop Paying Mortgages, and Stop Fretting.

These folks are going for up to two years without being forced out… and they’re still in the homes simply because of the vast number of defaults, pressure by the federal government to offer “modifications”, and other factors unique to this downturn. In some parts of the country, undoubtedly, it’s nearly “business as usual” on foreclosures… not up to 2 year delays. It also varies by state … states with judicial foreclosures are going very slowly.

The average borrower in foreclosure has been delinquent for 438 days before actually being evicted, up from 251 days in January 2008, according to LPS Applied Analytics…

In Pinellas and Pasco counties, which include St. Petersburg and the suburbs to the north, there are 34,000 open foreclosure cases, said J. Thomas McGrady, chief judge of the Pinellas-Pasco Circuit. Ten years ago, the average was about 4,000. “The volume is killing us,” Judge McGrady said.