Many advertisements with phrases like "sell and buy back" and "rent back house" are quite common these days. You might also have come across similar advertisements with headlines "houses for rent back" or something like "rent back" even on the internet while browsing. Because of the mortgage crunch such advertisements are quite common and it is a major concern for those who are in trouble with mortgages.

A lot of people had the opportunity to purchase homes a while ago when interest rates were lower or when "teaser" rates with low payments were offered. These monthly installments were the most they could afford then. However with flexible interest rates the monthly installments rose over time or interest rates went higher. The thought at that time was that salaries would also increase and home owners would be have the ability to pay higher monthly mortgages.

Unfortunately for many the increase in their pay has not equalled the increase in interest rates, making it so that some people are unable to match the increase in their monthly payments leaving them liable to repossession or foreclosure. The ability to sell and rent back house is a venture that gives you the opportunity to sell and rent your home back. This allows you stay in the place that your family knows, and hopefully be in a position to buy back in the future.

Some of the rent back house schemes have a guaranteed rental rate for an initial period of time to make budgeting easier. The initial rents are lower to help seller get back on his or her feet, increasing the likelihood of staying current on rents. They also may have provisions to protect the house from resale to a third party for a period of several years so that the original owners can get a new mortgage to buy back this house.

Anyone confronted with repossession or foreclosure should consider the drawbacks. There are never any guarantees that owners will be able to re-qualify to buy the home or that the rent will be affordable. Most people feel that selling the house to rent back is a superior alternative to losing the house to the bank and needing to move. It's advisable to get an independent opinion from your accountant, lawyer or some other financial advisor not attached to the rent back house company.

Like any other rental, you may have to pay a deposit when you rent this way and your rent will most likely be close to market value. The length of time the rate is guaranteed, the availability of a buy back option, and the rental period will vary according to the agreement. Shop around for the best terms, and make sure you understand all terms before signing anything. Do not wait until bailiffs are trying to take possession of the house. It is best to start early, as many good companies can stop repossession and save the house. Remember, selling the house to rent back can take several weeks. You might consider using the internet to find companies that specialize in this type of sale.