Homeowner goes from Foreclosure to owning their own home, payment free and with lots of Equity.
This could only happen in markets like Flint and Detroit Michigan!
Senior Citizens in Michigan facing foreclosure may find themselves upside down, no equity, and behind on payments one minute, and the next find themselves with no house payments or rent and having lots of equity. I know this sounds hard to believe, but you read it right, no payments and lots of equity. I am sure most people would want to know how someone with bad credit, possibly in foreclosure could wind up with a home with equity, and a mortgage with no payments and at an interest rate of around 6%.
There is a small group of investors in the Michigan market who are cash buyers. They are working with bank asset managers and REO Real Estate agents to buy bulk purchases of homes that have been foreclosed on. They are buying these homes for 10 - 20 % of there after repair value, they are rehabbing them, and then re-selling them to Senior Citizens at 52 - 65 % of the after repair value. Because the Michigan market home values have been so depressed, and the number of foreclosures are so high, these cash buyers are able to purchase these homes at all time lows. The Senior Citizens who are 62 years old or older can be approved for a reverse mortgage, and are perfect for a program of this kind. The investors are willing to sell the homes on a private mortgage for a short time frame until the senior is able to obtain the reverse mortgage, and pay the investor off.
A REVERSE MORTGAGE lets an owner convert home equity into cash: unlike a traditional mortgage, home equity loan, or second mortgage loan, the senior citizen never has to make a payment while they maintain the home as their principal residence. Currently there is no seasoning as to the length of time a senior has to live in the home before obtaining a reverse mortgage. Credit is not an issue on a reverse mortgage, because the bank is not expecting the senior to make any payments. The whole loan is based on the equity in the home and the age of the senior and life expectancy rates. The investor selling the home to the senior is paid off at the time of refinance, and the senior no longer has any payments.
This is such good news because the economy in Michigan has been hurting so many people with job losses and income reductions. Finally there is someone out there working to help our senior citizens who often have to spend the majority of there income on rent or house payments. Now they can have extra money every month for other expenses, because they can get into a home with no house payments. Keep in mind, The senior does still need to keep up with taxes and insurance on the home.
About the author: Tonya Horton is a local investor who works with bulk buyers and senior Citizens in the Michigan homeownership. Tonya and her husband Robert are also negotiating debt for homeowners facing foreclosure and assisting local area realtors in finding buyers for these homes, and whenever possible working with the home owner to stay in their home. They are also partners as Mortgage brokers assisting senior Citizens with reverse mortgages at Michigan's largest Reverse Mortgage Co. in the state. You may e-mail them @ email@example.com for more information.
There is a twist on Reverse Mortgages in the Michigan Real Estate Market. The Reverse Mortgage is being used to help Seniors get into a home with no payments. Private mortgages are being used to help Senior Citizens obtain a home through private investors. Because of the Michigan economy and influx of foreclosures, Michigan's market is giving investors enough equity to buy, fix, and sell to the senior citizen. The senior citizen is given enough equity for a reverse mortgage refinance to result in no house payments.
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