Yes, I also saw this article last night. A real estate agent introduced me to this concept when I backed away from a mortgage application recently. Too cumbersome and they kept asking for business related income, returns, operation date, why p.o. box, and On and on . . . despite the fact that I had indicated upfront I wasn't relying on my business to qualify - and it was not guaranteed. I had more than enough time in, only had to take loss some years.
Anyway, I lost patience with the process and withdrew.
Okay, so back to the Realtor: Turns out the "contract" buyer wasn't a new concept for him. Family contractor business where they purchase the home for the prospective homeowner, repair/renovate, and lease back to occupiers until they can get their own financing. Traditional methods of home purchasing are excluding a good majority of would-be owners. Once a homeowner, that mindset carries. My current landlord joked to his wife that she needed to consult with me, "the homeowner"!
Imo, the crisis/crash had not "affordability" as its primary driver, but poor planning. Looser lending standards, ARMS, and such work for people who are upwardly mobile (future income producer professionals); but you have to know when to cut your losses and leave. Fixed income, lower income, self-employed, retired, semi-retired, simply cannot afford rental housing. How does someone in any of those situations save for homeownership AND lease a property at current rent rates??
No easy answer. But, this, I know: Renters are paying 2 mortgage payments- that of the property owner, along with what <could be> the renter/lessee's own house payment. When this goes on for a couple of years or longer, you just know something has to give - in the interest of equity . . . and, well Equity!
Just as there are valid, justifiable reasons to rent vs. Buy, there should be reasonable alternatives to financing When it Makes Sense. No one keeps a 30-year note anyway. Why not go longer if more could take advantage? It seemed nuts when clients wanted to finance an automobile for 7-8 years. But so common now. Likewise, the 1st new car I bought was about 11k (in '88, I think); when I boldly took my (No Co-signed) loan request to the bank where I earned a meager salary, the branch manager said that he and his wife paid less than that for their first house! I was undeterred, of course and he gave me the loan (I guess he reckoned I wouldn't starve since wasn't living on my own yet).
It's Marketing Monday. Don't forget to put in a request for Direct work! |
