Renting a house... advice?

[jvgillow]

So I have been looking on the local MLS at some houses for rent because I am ready to move out of my apartment at the end of April. I want to rent because I'm not certain my job will remain in this area for more than another 1-2 years, so buying a house wouldn't be a sound decision.

I have also been hearing the news stories lately about renters that have been living in houses that go into foreclosure while they are renting, then they get kicked out with 30 days notice if they are lucky. I've noticed that a couple of the houses that have been listed for rental are actually owned by a bank or credit union, so I am wondering whether the ex-owner isn't just trying to make some rent money before the bank evicts whoever happens to reside there. Some listings come right out and say that the home is in pre-foreclosure and so I know to avoid those. For the ones that don't though, is there any good way to check and see if the house is in pre-foreclosure?

I also don't want to lose a big deposit if I move in and then have to leave a few months later because the owner lost the house. I've been gravitating toward places with smaller deposits just for that reason.

[quadman]

Wow.... yet another side of the housing crisis to consider. The thing that's tough for you, is there really is no way to know just what's going on with the mortgage on the property other than public records usually kept at the county level. And, by the time pre-forclosure hits those records, it could be too late to do very much.

A couple of thoughts....

I would put together a portfolio of ads about houses already in pre-forclosure, any articles about folks getting kicked out on short notice and losing their huge deposits or any other negative thing you can find about the rental climate in your area. Include copies of current rental insurance you carry, any positive letters you an put together from past landlords etc.

I would then try to negotiate a lower or even better, no security deposit, with a higher monthly rent. If you have a good credit score (assuming the landlord checks credit), and are up front about this being only a one or two year proposition, you may have some leverage in trying to do something like that.

If the landlord balks at this and is one who checks credit, and you're feeling fairly ballsy, tell them you won't accept any rental terms without a credit report from THEM to ensure their reliability as a potential landlord just as they are asking for the same from you as a potential tenant. Again, if you deal from a position of strength (and can back it up), you can make the argument that you are a "preferred tenant" that most landlords would give their right hand to have.

Get a few landlords "bidding" for your signature on a lease.... and I'll bet you'll be surprised at the kind of favorable deals you can negotiate for yourself.

[koa]

What about rental agencies? You could check for complaints with BBB. Maybe some will hold deposit in an escrow account. In my experience most tenant/landlord codes favor the tenant more than the landlord. You might have more chance of recovering your deposit from a reputable agency with offices. Maybe you could add an addendum to the lease in the event of foreclosure, you are given a certain amount of time or monetary compensation. I know where I live if I sell a house that is being rented by a tenant with a lease, the lease must be honored by new owners.

I grew up in Melbourne, actually it was called Eau Gallie at the time.

[Mep]

Is there a reason why you need a house? Maybe a better apartment or find a nice duplex. You may even find a nice stand alone structure in a community rental property. If the owner's business is renting out property then you are as safe as anyone can be. I wouldn't rent a house from just some guy renting out an extra property at this point in time.

[jvgillow]

Thanks for the tips so far.

I'm looking at houses because I can get a 2-car garage :), more space, don't have to worry about my movie volume, can use a propane grill on the patio without getting fined, can wash my car right in the driveway, etc. The large apartments around here are quite overpriced for what they offer, not to mention the negatives of living in an apartment/condo/duplex. Also if I go through the trouble of moving I want it to be an improvement in living quality, not just to save some monthly rent money.

[droht]

I was watching CNN over lunch today and one of their financial gurus said what the Quadman had already said here: "In this economy EVERYTHING is negotiable".

[jvgillow]

Yes I have seen it happening too since I've been watching the mls for the past 1-2 weeks. Some houses have been dropped ~100/month already, some have been sitting on the market since November '08 at the same price and nobody has touched them.

I kinda laugh at the homeowners who are trying to attract college renters with a $1400/month lease. That would have needed to be a 4-student house at the rate I would be been willing to pay in college.

[lngbruno]

Jeremy,

John, Quadman gave you excellent advice. All I can add is that you are between a rock and a hard spot. There are more horror stories surfacing every day and some of it has been traced back to gangsters out of Yugoslavia, Bosnia and neighboring countries. Over the past couple of years, these groups would land in certain areas of the country (Chicago, is where I heard about them) and buy up properties in this era of non-regulation banking. They were doing it with no money down (showing these larger bank accounts in their home country) and in some cases were given several thousands of dollars at the closing.

They would then start this rental scam. After they loaded up on 30, 50 or even 100 properties and holding one month in advance plus a couple months of rent without paying the loaning institution, they would head back home. They would have a couple hundred thousand dollars and leave renters out in the cold. :toilet:

In another plot these pond scum creatures would do it on a grander scale with condominiums. In this later case, the few who got in early were totally screwed until the bank took them over. To add insult to injury the banks aren’t taking them over via bankruptcy because if they did they would be liable for their share of expenses if an association was form (and in most cases it’s required by law).

Now, you would think that banks have implemented stopgap measures seeing how much of a mess they are in, and you would be wrong for the larger institutions. It seems they are still not grasping this issue. To add insult to injury there are other vultures flying over these carcasses and getting a few more folks to give up their hard earned savings in a ruse that they are there to help them. Once they get the money they leave town.

Be careful, this financial mess has become a haven for some really nasty folks. It may be more prudent for you to purchase a home in an area that will come back. Case in point, I have a couple of nieces and nephews who have been sitting on the sidelines waiting to jump into the market. They monitored the areas they wanted to live in and are planning on purchasing within the next month or two.

Good luck.

[SomeCiscoGuy]

Make sure to check your local and state laws regarding renters rights. Many states have protection built in for renters if the rented property goes into foreclosure or is sold.

[jvgillow]

Saw this in the Orlando news:

http://www.wesh.com/news/19089446/detail.html

[koa]

I had tenants once that I had to evict for not paying rent, besides suing me and finally being forced to leave, they went on to buy a new 300K house in a development. The developer gave them a 15k second mortgage. The bank (same one I use) gave them a 285K first mortgage, so absolutely nothing down. The tenants had used my house for rental income saying they owned it. When the bank called me (BEFORE approving their loan), to find out why I was the listed owner, I told the bank I had evicted them and they were scammers. Still got the loan. They never made one payment to the bank. It took almost a year to foreclose. In the meantime they were renting out the house to someone else. They were never caught, had to leave the state, but are still out there somewhere scamming.

[jvgillow]

Funny how things turn out. This morning I went to see 2 different houses that I was interested in renting. Got the rental applications from the realtors that did the house showings.

Once I arrived at work I found out they delivered 2-month notices to some people in our office, including one of my close friends. Fortunately I wasn't in that group, but I was in the group that's going to be offered relocation to Research Triangle Park in NC.

So it looks like I still get to move, but instead of across town it will be substantially further. I went to high school in Durham, NC so I'm already pretty familiar with that area... didn't think I'd be living there this year but what can you do.