(BREAKING NEWS, OP-ED) — The online webinar has been slated for Saturday, October 24, 2020 from 10:00 a.m. to 2:00 p.m. Please email [email protected] for a Registration Form.
The latest news articles (at least 20 of which this author has read) all indicate that the COVID-19-related foreclosure crisis will more than likely affect low-to-middle income homeowners who lost their jobs, including first-time homebuyers, single women and people of color who got federally-insured mortgage loans.
Despite all of the CARES Act help and moratorium extensions by the government, conventional mortgage loans were not part of the government’s intended program to stop the tide of foreclosures that are looming in the not to distant future. Because the crisis affected the mortgage loan servicers the worst, they are least likely to start granting en masse forbearances on mortgage loans as there’s no way they can recoup their losses fast enough.
The next game plan would seemingly call for mortgage loan modifications. This is where homeowners can restructure their loans using money they’ve been able to acquire over the short haul in an effort to meet qualification requirement payments that the servicers will demand in order to complete the loan mod. Should these modifications not happen in droves, it will spark another massive wave of foreclosures before the end of 2020. In this instance, it appears that the banks and their servicers are looking to the government for some sort of mitigation plan (in other words, another bailout, mitigation plan is just a nicer way of saying it).
As to the equity position some homeowners may have, restructuring could include downsizing through liquidation. Because loan delinquencies will show up on credit reports, it will become more difficult for evicted homeowners to find places to rent through the standard screening criteria. They will be faced with having to pay larger security deposits and higher rent because of their presumed risk having to go through back channels in order to find shelter. In many metro areas, mortgage loan delinquencies of 30 days or more were over 10%. This figure is very comparable to what America was facing in 2008 as over 10-million homes were foreclosed on in the years that followed. The housing crisis we are now facing could nearly match what we experienced between 2009 and 2015.
IN FLORIDA, WE PREPARE FOR HURRICANES
There are some exceptions to the housing crisis in areas of the U.S. that have stable rent and mortgage markets. Most of Florida and much of Texas fall into those two categories. These two states, which this author is using as an example, have no state income tax and lower sales taxes and less restrictions on business, which makes them more desirable to those living under current “Blue State” conditions. In many markets in Florida, residential resale inventories are declining, which seems to indicate the opinion that the 1000-people-a-day migration to the Sunshine State is impacting the crazy real estate boom.
However, a lot of homeowners who currently reside in both states are hunkering down and choosing not to liquidate, mainly because they can afford to ride out the storm, much in the same way homeowners in Florida prepare for hurricanes. If you’ve ever been to Florida during hurricane season or have seen pictures of the parking lot that Interstate 75 turns into when those who aren’t prepared or those in low-lying areas who are forced to evacuate take to the roadways to flee the storm’s path, you can get a fraction of a glimpse of how many homeowners aren’t displaced and are going to ride out the storm because they’re prepared. It’s just something you do when you live in Florida. The problem is, not all homeowners have the financial ability to prepare. Even though there are a lot of affluent folk living the dream, there are those groups of individuals and families that make up the support base (lower-paying incomes associated with health care, retail, restaurant and maintenance-related employment) are the ones taking the hardest hit in managing rent payments, which are skyrocketing beyond their ability to pay. This is why there is a need for affordable housing in Florida, which is why this author is now building steel SIPS homes (Structural Insulated Panel System), starting around 900 square feet. The need here for affordable housing is so great, even the news media can’t ignore it:
An affordable home that can withstand a category 5 hurricane? This builder says he has the answer | News | yoursun.com
This is what you call PLAN B …
Having alternative plans to move to safer, more productive areas is part of why you’ll see demographic shifts of migration around the country. When the construction industry booms in one area, workers from around the country migrate there seeking to become part of the construction labor pool. There are all sorts of retraining programs available, if you know where to look. America has always been resilient no matter what. Even in light of the COVID-19 snafu, Americans are bouncing back … but unfortunately, not ALL Americans are. It’s that 10% that make up the exception to the rule that will spark the crisis.
However, not everyone has a Plan B yet. This is why we’re doing the Foreclosure Defense 101 Workshop. California Attorney Al West has agreed to join me for this 4-hour webinar. This author is also talking to others who have been able to stave off foreclosure for over 10 years, through learning HOW TO fight the mortgage loan servicers and their attorneys in court. This of course, would be an exception to the rule.
We have made this workshop affordable and much easier to attend, as long as you have access to a computer and an email address. This author has already addressed the types of sample forms we’re going to make available, so for the sake of redundancy, we’ll stop there. If you or someone you know is in trouble, best to forward this post to them and/or have them email us at [email protected] for a Registration Form. Here is the syllabus of what we’ll be sharing in the workshop:
FORECLOSURE DEFENSE 101 SYLLABUS
UPDATE: Next week, you will be able to register to attend through our shopping cart on the Clouded Titles website!