If you've spiralled into a terrifying financial situation, take heart, because you're not alone. In today's volatile housing and job market, many people across the nation are facing repossession and bankruptcy due to no fault of their own. You may feel as though there is no way out of your situation, but there is an option you probably haven't thought of - selling your house and renting it back.

Two years ago, single mum Clare Wilson was facing exactly this same situation. After she became disabled due to debilitating rheumatoid arthritis, Clare could no longer work. She received a small amount of money each month from disability benefits, but it was just not enough to pay her mortgage, let alone eat and care for her two teenage boys.

After three years of massive bills and a mounting debt, Clare was at the end of her rope. She feared that the only way out was to sell the home she had lived in for thirty years. There were no other nearby homes for sale in her price range, and rental rates were astronomical. Claire thought that she and her two sons would have to move in with some of her relatives.

Fortunately at the time that her home was coming under the foreclosure process a friend of Clare gave her a call to tell her that she had figured out how to sell and rent back her home. This news excited Clare and after she did some inquiring she realized that this was something that she could do, and she wouldn't have to end up losing her home in the process. The fear of having the for sale sign up in front of her house was alleviated.

Here's a quick example of how the sell and rent back process works. First, Clare sells her home to a real estate firm that specializes in repossessions or foreclosures. After sitting down with a representative from a company, she determined a monthly rental rate that worked for her. She choose a rate that was low that she could get her house back in a reasonable time, without risking her ability to provide necessities. The properties to rent back, such as Clare's house, would rarely undergo a change of hands.

When a person sells a house to rent back, their monthly payments help to build equity in the home. They can just continue to rent indefinitely, but they can also use their rent toward the purchase of the home. They can either save up a down payment in order to buy the house back sooner, or they can keep paying rent until they've paid the total value of the house. That way, a person can eventually buy back their house when their finances improve. Being able to stay in one's house also prevents any embarrassment arising from knowledge of one's financial straits becoming public, and they will still have the proceeds from their home available to pay off the bills that have become insurmountable.