My mom has a limited income, so when she was left with a mortgage she couldn't afford after the divorce, she got creative with paying it. She rented out rooms in the house to make the mortgage payments, but all too soon, even that wasn't enough to keep up with the responsibilities of home ownership.
The house fell into a state of disrepair.
Soon after, my mom wasn't able to keep up with such a high mortgage payment, while trying unsuccessfully to maintain the property. By the time she was nearly twenty thousand dollars behind on the mortgage, the bank sent her notice of foreclosure. It was a very stressful time for everyone in my family. My brother sent her a lot of money while he was serving a tour with the Army in Afghanistan, but the bank couldn't accept the payments unless it was for the full amount.
It was at that time that she decided the only way to save the house was a mortgage modification. That was a long stressful and drawn out process for her. She was fortunate when her modification was approved, drastically reducing her monthly payments. The penalty was steep though, after paying on the house for 15 years, she now had a mortgage that was $25,000 more than the original one.
She continued renting rooms in the house for additional income, even after the modification. If not, she still couldn't afford the house. Eventually, she asked my husband and I if we'd be interested in buying the house from her... We'd been casually looking for awhile and thought it might be a good idea. She wasn't able to officially sell it for five years after the modification but for family, she wanted to do an owner carry type of contract.
At first, we were thrilled to accept the agreement, and started working out a contract immediately. She'd need to stay in the house for a few years, per the rules of the mortgage modification that she had, but that didn't need to stop us from moving into the house.
