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Another Family Makes a Move-A Few Foreclosure Reminders

Another Family Makes a MoveThe landlord didn't say a word but the notice tacked on the front door said it all.  The mortgage wasn't being paid and the bank was giving notice of the pending foreclosure action.

It isn't a new a new phenomena, in fact I first wrote about this back in October 2007  when one of my clients experienced the shock of a foreclosure move.  Fast forward and the notices are still arriving on door throughout Northern Virginia.  Along the way I've learned a few things to try and help my rental clients avoid this mid-lease move or protect their credit rating when the notice does arrive. 

Ask to see a copy of the last three mortgage statements from the prospective landlord to show that they are current on their payments.  It doesn't mean that they are going to keep paying but at least you know they are paying now.   If they aren't willing to share this information with you, be a bit suspicious as to why not.  Check the MLS to see if the property is also listed for sale.  On more than one occasion I've discovered a rental property listed for sale as a short sale.  That's a big red flag.


If the tenants see the foreclosure notice, have them "hold" the rent and deposit it with an attorney.
  Don't stop paying rent because your landlord is going to foreclosure.  There could be an implication on your credit, however advise the landlord that the rent will be held by an attorney until they can provide documentation that they are current on their mortgage payments. 

If the property is being professionally managed contact the management company to let them know of the impending foreclosure.  They often don't know until a tenant calls them that the landlord is in financial trouble. 

Though these steps may not help everyone I have found that they have made me look closely at rentals before I suggest a tenant sign a lease.  It has saved at least two of my clients thousands of dollars on "lost" rent when they discovered the landlord was headed to foreclosure. 

Remember that the chances are slim that a tenant will get back their security deposit on a foreclosed property.  Having the rent held by an attorney means that even if they end up having to turn some of it over to the landlord they may be able to hold on to an amount equal to their security deposit to use towards their next property.

                                   Real People*Real Lives*Real Estate

If you are interested in learning more about the Northern Virginia Real Estate market including Alexandria, Arlington, Fairfax and Prince William Counties give Cindy Jones and Integrity Real Estate Group a call at 703-346-2213.

Military Relocation Specialist serving military families relocating to and from the Pentagon, Fort Belvoir, Quantico MCB and all of the Military District of Washington installations. 

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Check out www.varealestatetalk.com and www.cjrealtygroup.com for more information.

Integrity Real Estate Group
 
Real People*Real Life*Real Estate

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Comment balloon 9 commentsCindy Jones • March 23 2009 06:01PM

Comments

This is going on in Michigan like you would not imagine. Renters need to be careful . Most here are consulting a Realtor now before they rent. Great article .

Posted by Lillian Nolloth (Howard Hanna Real Estate Services) over 9 years ago

My son's landlord lost 10 homes to foreclosure, and that taught me to do use a similar vetting process for rental clients.  Not many agents think to do this, and I don't know if I would have if this situation had not hit so close to home.

Posted by Margaret Woda, Maryland Real Estate & Military Relocation (Long & Foster Real Estate, Inc.) over 9 years ago

Jennifer-I asked an agent some of these questions last week prior to submitting a lease application for a military family.  He was surprised and answered all the questions and provided the requested information.  Later he said that I was the first agent that had ever asked and he thought it was a great idea.

Posted by Cindy Jones, Pentagon, Fort Belvoir & Quantico Real Estate News (Integrity Real Estate Group) over 9 years ago

Lillian-I'm being extra cautious with any rentals these days.  Especially if I see they have been purchased in the last few years and the MLS shows no money down sale.

Posted by Cindy Jones, Pentagon, Fort Belvoir & Quantico Real Estate News (Integrity Real Estate Group) over 9 years ago

Margaret-how terrible for your son.  A landlord with 10 properties that went to a foreclosure was an investor but just a plain speculator!

Posted by Cindy Jones, Pentagon, Fort Belvoir & Quantico Real Estate News (Integrity Real Estate Group) over 9 years ago

Great tips! I have usually represented more landlords than tenants and am use to be more cautious on the other end, but times are a changin'. It's a good idea to screen landlords these days too.

Posted by Carol Culkin, Overland Park (Reece & Nichols) over 9 years ago

Carol-hopefully if an agent asks you about the landlords credit you will understand why! 

Posted by Cindy Jones, Pentagon, Fort Belvoir & Quantico Real Estate News (Integrity Real Estate Group) over 9 years ago

Good advice for tenants. Buyers also need to be alert. We see active listings and homes under contract going to foreclosure every week. Buyer agents need to ask the same questions.

Follow me on Twitter:  http://twitter.com/roykelley  REO agent in Maryland

Posted by Roy Kelley, Roy and Dolores Kelley Photographs (Realty Group Referrals) over 9 years ago

Roy-great point.  Hopefully if a home is that close to foreclosure it would actually be listed as a short sale!

Posted by Cindy Jones, Pentagon, Fort Belvoir & Quantico Real Estate News (Integrity Real Estate Group) over 9 years ago

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