The Seller’s Loss of the Property Part 2
The mortgage company is not happy about not getting paid, so it accelerates the mortgage, making it all due and payable—foreclosure. It eventually takes the property back. Where does that leave you?
Once foreclosure is complete and the mortgage company has ownership of the property, your seller is out of the picture. She can no longer honor your option even if she wanted to. Your chances of buying the property could be out the window, along with any cash-back credit of your rent the seller was intending to give you.
Of course, you could deal directly with the mortgage company. They certainly don’t want the property, and perhaps you could buy it from them. And then again, perhaps not.
Or it could play out in a different way. Your seller could keep making the mortgage payments. But she could get herself in all kinds of debt, and her creditors could start slapping liens on the property in an attempt to get their money back. It wouldn’t take very long before there were more liens on the home than it might be worth. Were you to exercise your option, you might suddenly find that the seller is upside down—that is, she owes more on the house than the price you’ve agreed to.
Related posts:
- The Seller’s Loss of the Property Part 1 This is a serious problem and one that has received...
- The Seller’s Loss of the Property Part 3 A seller who is in financial difficulty is not one...