A recent study estimates that 47% of foreclosed properties remain occupied.
At first glance, this statistic may be surprising, but it doesn’t catch us off guard. Many people don’t realize that banks are not in the business of owning homes.
Financial institutions primarily focus on issuing loans, but when they are forced to foreclose on a property, they often end up taking ownership of the home until they can sell it to recoup their investment. Research has shown that when a foreclosed property in Augusta is left vacant, it is significantly more likely to fall into disrepair and deteriorate over time.
As a result, many banks find it preferable to allow occupants to remain in the property, even if payments have ceased. This approach helps deter vandalism and contributes to maintaining the home’s condition.
There’s been significant media coverage about individuals living without paying rent after foreclosure, with many stories highlighting banks ‘abandoning’ properties.
In these accounts, some people manage to avoid mortgage payments for months or even years.
It sounds appealing—who wouldn’t want to live for free? (wink)
But surely, it can’t be that straightforward, can it?
Right.
No bank would intentionally neglect collecting payments. The only way someone ends up living without making payments is due to significant errors in the process.
While it’s possible to find yourself in such a situation—and it has happened before—it’s important to note that avoiding payments you owe isn’t legal and can lead to serious consequences.
So, why are so many foreclosed homes still occupied? It’s crucial to understand that vacant properties are prime targets for vandalism and crime. Keeping occupants in the home can help banks protect their investment, making it beneficial for them to have the property occupied. Additionally, due to the way foreclosure laws are structured in Georgia, banks might encourage you to stay even if they technically ask you to leave.
There are a few perfectly legal ways to remain in your home, even after foreclosure.
How to Remain in Your Home After Foreclosure in Augusta
Not all of these options may be available to you, as it depends on your specific situation and your lender’s policies. It’s essential to seek expert advice throughout the process to navigate your choices effectively.
1) Wait it out. While this might not be the best option, it’s becoming more common. It’s important not to abandon your home at the first notice of default. Keep in mind that the foreclosure process can take months, or even years. It’s not finished until it’s truly over, so don’t lose hope too soon. However, it’s also wise not to wait until the sheriff arrives to evict you before you start preparing to move.
2) Go to court. In very rare instances, judges may grant stays and postpone evictions. This is typically only an option if you and your attorneys can demonstrate that the bank has failed to meet a legal requirement during the foreclosure process. In recent years, many cases of fraudulent behavior by banks have come to light, which could lead to a growing trend of using the courts to challenge foreclosures. However, fighting banks in court can be extremely difficult, costly, and time-consuming—even if you have a strong case, as most people do not stand a chance.
3) Propose a move-out bonus. Many buyers of occupied foreclosure properties end up spending thousands on legal fees and eviction costs. To save everyone time and money, why not consider taking some of that money for yourself? This approach, often referred to as ‘cash for keys,’ may sound a bit self-serving, but it can facilitate a smoother transition for everyone involved. By choosing not to abandon the property to squatters, you can assist both the bank and the new buyers as they prepare to take possession.
4) Rent it back.
It might seem surprising, but some banks are open to keeping former homeowners as tenants in their properties. This is usually a temporary arrangement, as they will expect you to vacate once a buyer is found. In some instances, we can even buy the property and rent it back to you.
It’s great that you’re taking the time to explore your options. We specialize in helping homeowners like you discover creative solutions.
We can’t assist everyone, but we may be able to help you.
We buy local Augusta Georgia houses from individuals who need to sell quickly.