Millions of people fall into the classification of “former homeowner,” once having owned a residence that has since gone into foreclosure. When these folks begin searching for a new place to live, one would think the foreclosure would make things difficult.
According to the residential rental industry, this is not the case.
Landlords are becoming used to dealing with victims of foreclosure looking to rent apartments or homes. The situation has become so common that many rental companies are no longer taking the foreclosure into consideration when making rental decisions.
Just as medical bills were once a red flag to rental agencies, but no longer, so are home foreclosures.
One rental agent in New York City reported that the housing crisis had many victims from all walks of life. Dealing with someone with a previous foreclosure on the credit report is a basic component of doing business.
Individuals who have been through foreclosure are not having difficulty finding someplace to rent, said the agent.
Foreclosures were once a huge black mark when it came to renting. Having bad credit due to a foreclosure meant restricted rental options and huge security deposits.
Now, over seven million U.S. residents have been through foreclosure and according to real estate agents, this experience does not negatively affect the ability to rent a place to live.
These former homeowners chose to walk away from their houses for different reasons. Some were upside down in their mortgages and others owed more than they could ever repay to just break even.
They have been able to secure rental apartments and homes without taking out payday loans to fund the security deposit. By reestablishing their credit through proper use of bad credit auto financing and credit cards, they may be approved for a new mortgage in as little as three years.
