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How to Stay in My Home After Foreclosure in Phoenix

A recent study estimates that 47% of foreclosed properties are still occupied.

When you first see that stat you may be surprised… but we’re not. When you understand the mechanics of a foreclosure and where each parties interests lie, you’ll likely reconsider your stance on it.

What most people don’t realize is that banks aren’t in the business to own homes. In fact, there is nothing they would rather do less. 

They are in the business to loan people money. But when they have to foreclose on a house… the bank is forced to own the home until they’re able to sell it to get all or most of their money back. Their systems and processes are geared towards evaluating investment opportunities or safe lending options and deploying their capital. When they are forced to uproot and take possession of a property, deal with renovations, break-ins, trying to resell the place, etc they become tired of that real fast.

What they had found is that when a Phoenix foreclosed house goes vacant… there is a much greater chance that the house will fall into disrepair.  Often times the bank would rather have you in the property even after you stop paying your payments and the foreclosure is started because it wards of vandals and keeps the house in good working order. If unauthorized occupants were to enter the home it could take months to get them out which holds up the bank from getting their money back even longer.

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 great! Let’s all live for free. (wink wink)

Wait… it can’t be that simple, right?

Right.

No bank would purposely neglect to collect payments. The only way that you get to live without making any payments is when some major mistakes were 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 get you in serious trouble. The chickens will always come home to roost and while you may get away with it for a number of weeks, months, maybe years! You will eventually be caught and the repercussions will be bad. 

So, I’m sure you’re likely wondering then…. 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’s actually in their best interests to keep it occupied. Partly because of the ways that the foreclosure laws are structured in AZ, banks may ask you to leave while wanting you to stay.

The banks are stuck between a rock and a hard place because they would not want to let people live for free because everyone would do it. They also don’t want the home to sit vacant or else it could be a prime target for break-ins and vandalism. Purposely avoiding payments and trying to sneakily live for free also is not a good plan, so what’s the best alternative?

There are a few perfectly LEGAL ways to remain in your home, even after foreclosure.

How To Stay In My Home After Foreclosure In Phoenix

Not all these options are available (depending on your situation and your lenders), and you’ll need some expert advice along the way to help you get through.

1) Wait it out. Admittedly, this option may not be the most appealing, but it appears to be increasingly common. It’s important to emphasize that the moment you receive the initial notice of default, you shouldn’t hastily abandon your property. It’s crucial to understand that the foreclosure process can be a lengthy one, extending for months or even years. Patience and perseverance are key, so don’t lose hope prematurely.

On the other hand, procrastinating until the sheriff arrives to evict you before you start packing is not a prudent approach either. Striking a balance between these extremes is the wiser path to take.

2) Go to court. In extremely rare instances, judges are granting stays and postponing evictions. However, this avenue is typically only viable if you (and your legal representation) can substantiate that the bank has failed to fulfill a legal obligation during the foreclosure process. It’s worth noting that recent years have revealed numerous instances of fraudulent behavior within banks, which might lead to a growing trend of utilizing the legal system to halt foreclosures.

Nevertheless, it’s essential to recognize that taking on banks with legal proceedings is a formidable, costly, and time-intensive undertaking, even if you have an exceptionally strong case (which is a rarity). In reality, most individuals find it exceptionally challenging to prevail in such battles.

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”. It sounds a little greedy, but greasing the wheels does help everything to run smooth. Plus, you can help out the bank and the buyers by not abandoning the house to squatters before they’re ready to take possession. You can present this case to them and after reading this article you will be able to see things from their prospective. This will allow you to connect with them and find a solution that works for the both of you.

4) Rent it back. It might sound unconventional, but there are instances where certain banks are open to the idea of former homeowners remaining as tenants in the property they’ve lost. However, it’s important to understand that this is typically a temporary arrangement. The bank’s ultimate goal is to have you agree to vacate the premises once they secure a new buyer. There are even situations where we can step in and purchase the property, subsequently renting it back to you.

The fact that you’re taking the time to read this page and consider your alternatives is commendable. We specialize in assisting homeowners like you in discovering inventive solutions to navigate challenging situations.

5) Just sell the house. All of the options above are delaying the inevitable and that is that you are going to need to find other living arrangements. Why wait and let the balance of money you owe the bank accrue higher and higher? You’re probably better off selling the home as soon as possible so you can recoup a larger portion of the proceeds. At Integrity Acquisitions we specialize in cash transactions and helping homeowners sell their properties when they are facing foreclosure. We can even help you get the most cash for your house if you inherited it in foreclosure. It is extremely rare for us to find a situation we have not overcome before.

We can’t help everyone, but we might be able to help you.

We buy local Phoenix AZ houses like yours from people who need to sell fast. Trust who you sell your home to!

Give us a call anytime at CALL US! (480) 818-6535‬ or
fill out the form on this website today! >>

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