A recent study estimates that 47% of foreclosed properties are still occupied.
You may be surprised to learn about that statistic… but we’re not.
What most people don’t realize is that banks don’t want to own homes.
They are in the business to earn interest by lending people money. But when they have to foreclose on a house… the bank is forced to take ownership of the home until they’re able to sell it to get all or at least most of their investment back.
But, what lenders have found is that when a foreclosed house in Richmond, Chesterfield, Henrico or any local county goes vacant… there is a much greater chance that the house will fall into disrepair. Often times the bank would rather have you living in the property even after you stop paying your payments and the foreclosure is started. Sometimes this helps reduce vandals, and additional maintenance problems.
There’s been a lot of talk in the media about people living for free after foreclosure – and even many stories about banks “abandoning” properties.
In those stories, people are avoiding house payments for months, even years.
Man, that sounds fantastic! Let’s all enjoy a house for free. (wink)
Wait… it can’t be that simple, right?
Right.
Of course a bank would never purposely neglect to collect payments. The only way that you get to live without making any payments is when some major mistakes are made.
But you might get lucky! It’s possible, and it’s happened before. However, it’s not exactly legal to avoid payments that you owe, and it can cause serious trouble for you.
So why are so many foreclosed homes occupied? It’s important to remember that no one wants the house to be vacant. Vacant homes are targets for vandalism and crime.
Staying in the property can help the bank maintain the value of their investment, so it really can be in their best interests to keep it occupied. Partly because of the ways that the foreclosure laws are structured in the surrounding counties of the Greater Richmond VA area, 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 Richmond
Not all these options are available (depending on your situation and your lenders), and you’ll need to have some expert advice along the way to help you get through.
1) Wait it out. Honestly, this is a pretty terrible 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. Remember that the proceedings and the process takes months and in some cases, years. It’s not over until it’s over, so don’t give up too soon. On the other hand, don’t wait until the sheriff shows up to evict you to start packing up your belongings.
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. After 2020, a lot of recent fraudulent behavior at banks has been uncovered – so we may see an increasing trend of using the courts to stop foreclosure. Fighting banks with lawyers is very difficult, expensive and time-consuming. Most people don’t stand a chance even if they’ve got a perfect case.
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 the time and expense by taking some of that money yourself? It’s known as “cash for keys”. Does this sound a little greedy? Consider that greasing the wheels does help everything to run more smoothly. Plus, you can help out the bank and the buyers by not abandoning the house to squatters before they’re ready to take possession.
4) Rent it back. It may sound crazy, but some banks are willing to take on previous homeowners as tenants in their property. That’s only a short-term fix, as they’ll want your agreement to vacate the premises as soon as they find someone to purchase the property. In some cases, we can even purchase the property and rent it back to you.
It’s really good that you’re reading this page and exploring your options. We help homeowners like you to find creative solutions.
We can’t help everyone, but we might be able to help you.
We buy local Richmond VA houses like yours from people who need to sell fast.s