A New Trend in Home Buying
According to Yahoo Finance, there has been a trend in the recent months of property purchasing. Property companies have been appearing on the scene buying homes from homeowners who are finding mortgage payments too hard to maintain. There are now more than 200 companies buying houses at lower than market value. In some circumstances, they are even renting them back to the seller.
This seems to benefit both parties as the property companies purchase the homes at 70%-80% market value and the sellers can continue to live in their home, trading a lesser rent payment for a higher mortgage.
However consumers are being asked to enter into agreements with these companies carefully. Standards can be very different and because this sector is not regulated, the consumer has very little, if any, protection. It has been known that companies rent out the house to the seller only to evict them at a time when the house can be resold for profit. Consumers should contract their own independent solicitors and surveyors and not to use the ones supplied by the property purchasers.
The situation places emphasis on how overstretched the country is and how they are struggling with debt. It’s also a fair indicator of how increasing interest rates are placing more pressure on those struggling to pay their debt.