Why can't there be a lot more decent land contracts to buy properties in USA foreclosed?
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Honestly, I think a land contract is a much more righteous way to buy a home anyways. Example... Giving lots of people homes on credit was ok to some degree, but it made the prices of home go way up, and now that many people haven't good enough credit to buy a home, we jut have many vacant houses. These houses are collecting dust and deteriorating with time, with few people to have the option to buy one. Why is it the bank is only fair to people with good credit? Here is a scenario. Lets say I have $2,000 to put down on a simple $30,000 livable home but my credit sucks. It seams to me that $2,000 should be enough to at least get me into something. It shows commitement. Now, Lets say that home normally has payments of $330 for someone who bought with credit, and to rent that home would cost around $500 if rented. So now they set a contract with me to pay $575/ mo where $75 of it goes to an escrow account which can only be used to either repair the home, pay it off when the amount exceeds the balance, or you just simply lose it when you walk away from the home. Sounds like a fair deal doesn't it? Furthermore, the interests rate should be exactly the same as a man with good credit, we aren't trying to suffocatethe poor anymore. banks win, people win, economy wins, the house wins, and it is probably a better system than credit in the first place. Credit is not NEARLY as righteous as a contract like this. It will give people more integrity, more stability, and the option to lose it if times are hard. The bank still wins, and can easily put another person in the home because they offer more options to people now, which gives them more customers. I'm tired of people with good credit holding their heads highly in vain thinking they are better than a person who would RATHER do a contract like this even if he had good credit. Why? Because this is secure for everyone. No one loses unless I walk away from the home, then i lose. The worst case scenario of people destroying the house will still be made up for in the long run. The bank might have more paperwork, and have to hire more employees, but those jobs help the economy... I know that there are land contracts out there, but why are there not any FAIR ones? Why is it that people who believe in paying for things with cash the best they can are the ones who suffer when they aren't the once who inflate prices with phony money that hasn't yet been workedfor? If anything, these contracts should be a better deal than credit. Charge THE CREDIT HOLDER A COUPLE GRAND MORE FOR THE HOME... Whats your thoughts?
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Answer:
Why you ask? because wealthy corporate America controls everything down to who gets elected and ultimately makes our laws. Fairness does not come into play nor does the well being of the working class (the people who build these homes from the ground up). I have been in the game too long to be fooled into thinking anything different.
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Other answers
Because banks do not want to own and manage property. They are financial institutions, not real estate companies. Their only involvement in the entire house buying situation is to loan people money. Having done so, they want the money back, not the house. A bank has no influence on what house you buy with the money, where the house is located, what kind of condition it is in. All they want to know is that, if they lend you money, you are likely to pay it back, and if you don't, that the property that YOU are pledging as collateral for the loan is worth what they are lending. You seem to be a bit confused about how house buying works. If a house is for sale for X, you can buy it for that amount by paying cash or getting a mortgage. When you get the mortgage, you buy the house for X. But, since you borrowed the money, you pay the money back to the bank with interest, to cover their risk in lending you the money. This doesn't change the price of the house any. As an analogy, think of this situation. Your friend really wants to buy a pizza for 20 bucks, but he doesn't get paid until 3 days from now. He asks you to lend him the 20. You know that your friend has a good track record of paying people back, but you would really like to have that money back, so you say that you will if he pays you back the 20, plus 1 dollar because you'd been planning on spending that money yourself, and you want some incentive to give it to him instead. Everything goes according to plan: he gets a $20 pizza and gives you back 21 dollars. This doesn't mean that the pizza suddenly cost 21 bucks. And people who want to buy a house with cash are free to do so, and many people do.
philospher77
Way too much to read.. ..But yeah, I'm with the banks on this one - we don't want to lose money. When we give people loans we want profits, you pay $2000 on a $30,000 house is risky for a loaner to accept you when you have a bad credit - people with bad credit have proven they aren't capable of paying on time or paying at all. Besides not being paid back, you could damage the house and cost the banker to ask less to future buyers, also with the market the way it is - price may even decrease in value.
William
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