Desparate Acts Can Dig Deeper Holes

Desperate Acts Dig Deeper Holes

Next to health issues, financial woes probably cause more stress than any other life altering situation.  The other day, Cindy in Indy wrote a post about a homeowner that had rolled their car into their mortgage.  For me it was deja vu.  Not for me personally, but someone that I know had done the same thing.  At the time, my question to that person was:  Do you really want to spend 30 years paying for a car?

So when I read Cindy's post, I wondered what prompted that owner to make that decision to roll the car into the mortgage.  Were they behind in car payments?  Were they just trying to consolidate debt? Did they feel that was their only option?

OTHER ACTS OF DESPERATION INVOLVING HOMEOWNERSHIP THAT COME TO MIND

There are just a few other things that come to mind when I think of desperate acts that people take in the realm of homeownership.

DISTRESSED HOMEOWNERS (Foreclosures and Short Sales)
This one is an obvious act of desperation and there may be many, many reasons why sellers fall behind in their mortgage including job loss, other loss of income, illness or other crisis.  I don't know what I would do if I were in many of these homeowners shoes, but I'd like to think that I would still be the rational person that I think that I am today.  Having said that, it seems that I would realize early on that I am in a situation where I need to take action and move quickly.  Sometimes homeowners see it coming and standby and take no action.  Other times, they are caught totally oFf guard.  Ultimately their desperate act is that they did not ACT at all and now face the stress inducing process of foreclosure.  With loan mods, short sales, deeds in lieu of foreclosure, etc. there really is no reason to sit idle by and let the situation consume you.  It's unfortunate and I have the utmost compassion for you.  But something tells me that most rationale people would give this same advice to people who they know are distressed homeowners. Now it may be time to follow your own advice.

LEASE PURCHASE AND LEASE WITH OPTION TO PURCHASE BUYERS
In some areas of the country, I've been told that lease purchase and or lease with an option to purchase is the only affordable way to own a home in some cases.  But here in the Metro Birmingham area, what I hear most often is this:  I want to do a lease purchase so I can take some time to clean up my credit.  In my mind, I'm always thinking that this class of buyers want a house so bad that they are willing to lose their downpayment not knowing whether they will ever own the lease purchase home.  I'm not saying that it can't happen.  But why not clean up your credit first and then set out on a quest to purchase a home.  It may just make sense to rent while you straighten out any credit issues.  Besides when you finally do clean your credit up, there may be another home on the market that you'll love even more.

The point here is that people will often force an action to make sense simply to justify their desire to do something.  I'd venture to say that this plan will almost always backfire.