by Paige Panzarello | Sep 23, 2021 | blog, investing, real estate
After the Supreme Court struck the national eviction ban down last week and is no longer in effect, it leaves, according to CNBC, “…more than 11 million Americans still behind on their rent at risk of being forced out of their homes.” The NY Press News adds, “However, at least four states and Washington, D.C., will continue to ban evictions: Illinois will do so until Sept. 19; California’s ban will last through Sept. 30, and New Jersey and D.C. will still curb the proceedings until January 2022. New Mexico also has an eviction moratorium with no end date announced.”
When Does the Foreclosure Moratorium End?
For homeowners with mortgages backed by government-sponsored enterprises like, Fannie Mae or Freddie Mac, the Federal Housing Finance Agency, the foreclosure moratorium runs through the end of the year. That means lenders that hold the loans cannot begin the foreclosure process before then.
However, lenders are now free to take back vacant properties in foreclosure from delinquent homeowners.
How much, how fast, and where that happens will depend on how different banks approach the end of forbearance. Some lenders may decide to vigorously pursue foreclosures to recoup losses from the pandemic, while others will give homeowners more time to get back on their feet. However. it’s hard to imagine that zombie foreclosures will continue to be so few and far between across the national landscape.
A Zombie Foreclosure
A zombie foreclosure refers to a situation where a homeowner vacates their property after receiving a notice of default, expecting they will lose the home in the pending foreclosure. the house is essentially dead, growing more decayed and decrepit over time
So why is it called a zombie foreclosure? Like its namesake, but its mere presence can continue to cause harm to its former owners and the community around it.
Often, zombie foreclosures occur in low-income areas where the bank is not anxious to assume responsibility for the upkeep of the property and wants to save on taxes, as well as other costs. If squatters occupy the property or it falls into severe disrepair, the bank may simply wash its hands of the property.
Forbearance Ends for Many
Forbearance has been a godsend for many, but now, for example, one homeowner owes over $20,000 on her home, and her forbearance ends next month since the federal ban on foreclosures expired Saturday. This owner is one of about 1.8 million homeowners still in forbearance as the safety net ends. About a fifth of them will not be able to extend their forbearance past September. And among all homeowners, 1.5 million are 90 days or more behind on their mortgage payments but not in foreclosure.
Here’s how Rick Sharga, executive vice president of foreclosure platform RealtyTrac, put it: “The end of the government’s moratorium won’t result in millions of foreclosures, but we’re likely to see a steady increase in default activity for the balance of the year. Much of the foreclosure volume will come from the reinstatement of foreclosure proceedings on properties that had already been in default before the pandemic and new foreclosure activity on vacant and abandoned properties.”
Paige Panzarello, the “Cashflow Chick,” Founder of The Tryllion Group, Investor/Entrepreneur having done $150 Million+ in real estate transactions; Specializing in Non-Performing Notes. She has been a regularly featured guest on “The Cashflow Guys” podcast, and you can also find her on many other Real Estate and Entrepreneurial podcasts and in the Wall Street Journal as well. She also speaks at various Real Estate Investing clubs and conferences across the country. Paige teaches the “Building Wealth with Notes” Workshop that drills down into the details of how to successfully buy Non-Performing Notes, create passive income, and mitigate risk. www.CashflowChick.com/training
Surviving the crash of 2007, Paige knows how “life happens” every day. Her passion is to help people build wealth, secure their financial future, enjoy life, and be ready-not broken! Whether it is improving communities one house at a time, assisting borrowers in staying in their homes, or working with other investors to learn a new way to earn higher investment dollars for their retirement years potentially, Paige dedicates herself and her business to helping people improve their lives in every way. For more information got to www.CashflowChick.com
by Paige Panzarello | Sep 8, 2021 | blog, investing, real estate
According to The Housing Wire, there are 1.7 million homeowners remaining in U.S. forbearance. ATTOM, parent company to RealtyTrac (www.realtytrac.com), released its July 2021 U.S. Foreclosure Market Report, which shows there were a total of 12,483 U.S. properties with foreclosure filings — default notices, scheduled auctions, or bank repossessions — down 4 percent from a month ago but up 40 percent from a year ago. These numbers reflect the last month before lifting the government moratorium on foreclosures.
“The end of the government’s moratorium won’t result in millions of foreclosures, but we’re likely to see a steady increase in default activity for the balance of the year,” said Rick Sharga, executive vice president of RealtyTrac, an ATTOM company. “Much of the foreclosure volume will come from the reinstatement of foreclosure proceedings on properties that had already been in default before the pandemic, and new foreclosure activity on vacant and abandoned properties.”
U.S. Forbearance
The Housing Wire reported, “Of the 1.7 million homeowners remaining in forbearance, 13% are current on their payments as of August 1, and of those who exited forbearance last week, more than 10.5% were current,” noted Mike Fratantoni, MBA senior vice president and chief economist. “Forbearance has surely provided both insurance and assurance for many of these homeowners who worried about ongoing hardships, and it is positive to see so many continue to be able to make their payments while in forbearance.”
Fratanoni added that delinquency rates have increased slightly for borrowers who have exited forbearance and began repayment plans.
Significant Wave of Forbearance Exits
According to Yahoo Finance, The most significant wave of forbearance exits should come in September and October of 2021, and Zillow projects that forbearance exits will lead to an additional 0.40 months of housing supply in August – October of 2021, a 15% increase relative to 2.6 months of supply in June. For context, this additional 0.40 months of supply roughly means an extra 211,700 homes for sale, which would represent 13.1% of all predicted sales over the next three months.
Compared to 2008
Unlike 2008, financial conditions and a souring housing market pushed many homeowners into involuntary foreclosure. This time, strong equity growth and a robust seller’s market are likely to ensure that even distressed homeowners have more options.
This projection assumes that borrowers exiting forbearance in August – October will behave similarly to borrowers exiting forbearance in the past year, when approximately 25% of borrowers may have listed their homes for sale following their forbearance exit. If the economy is in a more distressed scenario, 50% of forbearance exits could lead to homes listed for sale by foreclosure or a pre-emptive borrower.
If we get another lockdown because of the Covid variants, the economy will slow, and recovery from forbearance would suffer.
Paige Panzarello, the “Cashflow Chick,” Founder of The Tryllion Group, Investor/Entrepreneur having done $150 Million+ in real estate transactions; Specializing in Non-Performing Notes. She has been a regularly featured guest on “The Cashflow Guys” podcast, and you can also find her on many other Real Estate and Entrepreneurial podcasts and in the Wall Street Journal as well. She also speaks at various Real Estate Investing clubs and conferences across the country. Paige teaches the “Building Wealth with Notes” Workshop that drills down into the details of how to successfully buy Non-Performing Notes, create passive income, and mitigate risk. www.CashflowChick.com/training
Surviving the crash of 2007, Paige knows how “life happens” every day. Her passion is to help people build wealth, secure their financial future, enjoy life, and be ready-not broken! Whether it is improving communities one house at a time, assisting borrowers in staying in their homes, or working with other investors to learn a new way to earn higher investment dollars for their retirement years potentially, Paige dedicates herself and her business to helping people improve their lives in every way. For more information got to www.CashflowChick.com
by Paige Panzarello | Aug 25, 2021 | blog, investing, real estate
If everything is going well and you have an excellent agent, you may not require the services of a lawyer. However, there are situations when to hire a real estate lawyer is a good question.
When to Hire a Real Estate Lawyer
When Buying Without a Broker
A “for sale by owner” transaction will save you money on real estate commissions, but someone is needed to create the purchase agreement, title deed, and other paperwork. A lawyer may aid you in organizing your paperwork, ensuring that the title is clear, and assisting you with the finer points of the transaction.
When You are The Buyer, and You Have No Agent
If you make an offer on a house without using a real estate agent, the seller’s agent will offer to handle everything for you. This type of deal might need a lawyer because one agent cannot represent your and the seller’s interests. When you hire a lawyer, you may rest assured that they will only work for you and safeguard your interests.
When There is an Issue With the Property or the Transaction
A lawyer can assist you in resolving some of the difficulties that may arise. For example, easements, rights of way, boundary disputes, and other concerns about the house’s land can have problems. If the property is in foreclosure or further legal proceedings, you could require legal assistance if you disagree with the buyer or seller. If someone threatens to sue you, you should always see a lawyer.
When You Are Buying Notes
Mortgage notes are loans created when a home sells. A bank or lending institution funds private mortgage notes. Mortgage notes are also known as cash flow notes, seller-financed notes, owner-financed notes, or seller carry-back notes. Investors can purchase these notes. They are reasonably secure investments because the real estate secures the note.
Lenders sell mortgage notes at a discount. The buyer pays a discounted rate for the loan and, in turn, receives all future payments made on the loan by the mortgagee.
There are some risks involved. A Real Estate lawyer specializing in mortgages and mortgage note selling or buying can assist you in understanding the complexities involved.
When You’re Concerned About the Ramifications for Your Tax Situation
As the seller, you may be subject to capital gains tax if the home’s value has increased. If you’re the one who’s buying, you may be able to deduct interest on a mortgage from your taxes. If you want to rent the property, you’ll need to track your rental revenue and expenses on your taxes. A lawyer or CPA can assist you in determining how the purchase or sale of your home may impact your tax return.
When You Intend to Make Changes to the Home’s Exterior
Your local government, historic district, or homeowners’ organization may have tight guidelines for what you can and cannot do to the exterior of your property. These guidelines might apply to anything from demolition to additions to solar panels to new paint colors. A lawyer can interpret and clarify these rules and advise you on the viability of your plans and assist you in structuring the transaction and obtaining the necessary approvals.
Paige Panzarello, the “Cashflow Chick,” Founder of The Tryllion Group, Investor/Entrepreneur having done $150 Million+ in real estate transactions; Specializing in Non-Performing Notes. She has been a regularly featured guest on “The Cashflow Guys” podcast, and you can also find her on many other Real Estate and Entrepreneurial podcasts and in the Wall Street Journal as well. She also speaks at various Real Estate Investing clubs and conferences across the country. Paige teaches the “Building Wealth with Notes” Workshop that drills down into the details of how to successfully buy Non-Performing Notes, create passive income, and mitigate risk. www.CashflowChick.com/training
Surviving the crash of 2007, Paige knows how “life happens” every day. Her passion is to help people build wealth, secure their financial future, enjoy life, and be ready-not broken! Whether it is improving communities one house at a time, assisting borrowers in staying in their homes, or working with other investors to learn a new way to earn higher investment dollars for their retirement years potentially, Paige dedicates herself and her business to helping people improve their lives in every way. For more information got to www.CashflowChick.com
by Paige Panzarello | Aug 11, 2021 | blog, investing, real estate
We are nearing the end of the financial protections that kept many households afloat throughout the Covid-19 pandemic. These protections will end in the coming days and weeks, including enhanced unemployment benefits and moratoria on evictions and mortgage foreclosures. While government agencies have renewed many protections multiple times, it is unlikely that extensions will continue as more people get vaccinated and the economy continues to recover.
Here’s a timeline of when some of the most critical protections will end unless the government takes further action, but as we said, that is unlikely.
We Are Nearing the End of Financial Protections
The scheduled federal eviction moratorium will lapse on July 31. While it has been extended multiple times throughout the pandemic, it is not likely to be again.
Seven million Americans are now behind on their rent due to the pandemic. As a result, both the New York and California eviction have extended moratoriums; — New York’s moratorium lasts through August 31, and California now lasts through to September 30, 2021.
States also still have billions of dollars in rental relief to give out to tenants in need. But, so far, the relief process, which varies by state and in some cases locality, has been slow-moving for many. Remember the saying, “I’m from the government. I’m here to help.”
The mortgage foreclosure moratorium will also lapse on July 31, and it is not likely to be extended. That said, the Consumer Financial Protection Bureau (CPFB) has put three additional measures in place to help homeowners who are more than 120 days behind on their mortgage payments.
- Before any foreclosure can start, a loss mitigation application must be completed and submitted by the borrower, and thoroughly reviewed by the loan servicer. If borrowers are still unable to make payments after exhausting the foreclosure avoidance options, the foreclosure process will proceed.
- Loan servicers need to confirm that a property is abandoned under local and state laws before starting foreclosure proceedings.
- Loan servicers need to make a reasonable effort to reach borrowers before starting any foreclosure proceedings. For example, if the homeowner is more than four months behind on their rent and unresponsive for more than 90 days, the process can move forward.
Enhanced unemployment insurance payments have already ceased being paid to millions of Americans after dozens of Republican state governments cut the federal benefits early to encourage recipients to go back to work. (some of these states face lawsuits as a result).
For the rest of the states, the $300-per-week federal supplement and all benefits for the self-employed, gig economy, and freelance workers will end on Sept. 6, 2021. In addition, the Pandemic Emergency Unemployment Compensation program, which currently provides additional weeks of benefits to the long-term unemployed, will also end. After that, the unemployed will be eligible for the standard number of weeks of benefits that their states allow in non-pandemic times.
A 15% increase in maximum benefits for recipients of Supplemental Nutrition Assistance Program (SNAP) benefits expires after Sept. 30.
Federal student loan payments, which paused for the past 16 months, are scheduled to resume on October 1, 2021. An extension here is possible.
“Whatever sacrifices you’re going to make in order to come up with that payment each month, I would say start now,” Shelly-Ann Eweka, senior director of financial planning strategy at TIAA.
Paige Panzarello, the “Cashflow Chick,” Founder of The Tryllion Group, Investor/Entrepreneur having done $150 Million+ in real estate transactions; Specializing in Non-Performing Notes. She has been a regularly featured guest on “The Cashflow Guys” podcast, and you can also find her on many other Real Estate and Entrepreneurial podcasts and in the Wall Street Journal as well. She also speaks at various Real Estate Investing clubs and conferences across the country. Paige teaches the “Building Wealth with Notes” Workshop that drills down into the details of how to successfully buy Non-Performing Notes, create passive income, and mitigate risk. www.CashflowChick.com/training
Surviving the crash of 2007, Paige knows how “life happens” every day. Her passion is to help people build wealth, secure their financial future, enjoy life, and be ready-not broken! Whether it is improving communities one house at a time, assisting borrowers in staying in their homes, or working with other investors to learn a new way to earn higher investment dollars for their retirement years potentially, Paige dedicates herself and her business to helping people improve their lives in every way. For more information got to www.CashflowChick.com
by Paige Panzarello | Jul 14, 2021 | blog, investing, real estate
Is this our future? Since Roman times the idea of buying votes with bread and circuses has been a staple of politicians. Vote for me, and I’ll make sure that you will receive farm subsidies and price supports. Vote for me, and I’ll make sure you’ll have free healthcare; I’ll pay off your student loans. And while we are at it, education is essential. So I’ll give you a free college education. Vote for me, and I’ll even pay you not to work. Now, this:
California Proposes Subsidy to Cover Almost Half the Cost of First-Time Buyer’s Homes
According to Realty Biz News, “Lawmakers in California have come up with a dramatic new proposal that, if it comes into being, would offer hope to first-time buyers that are struggling to find a home to buy in the state.
“California Senate Democrats have included a new program in a budget proposal unveiled last week that would massively subsidize the cost of buying a first home.”
“The California Dream for All program is a part of the Democrats’ larger Build Back Boldly program first outlined in April. Last week, lawmakers provided more details, saying the plan would subsidize up to 45% of the price of a home for a first-time buyer in the state, effectively slashing the price almost in half.”
Is This Our Future?
The plan is a bit complex. First, the California Dream Fund would receive a one-time infusion of state and federal funds. Then, the state would sell shares of the fund to private investors who would benefit from earning tax-free returns on the appreciating value of the homes that money funds. So those investors, in effect, become silent partners of homebuyers who take advantage of the subsidy. The homeowners would be responsible for all of the maintenance costs, property taxes, and insurance premiums, and they would have the option to buy out the investors’ share in their home at a later date.
Housing Shortage
There is a housing shortage everywhere in the United States, and that shortage is causing prices to rise. A March survey found that nine out of 10 respondents considered housing affordability to be a serious problem.
How would the plan work? An example cited is of a home priced at $400,000. The idea is that the first-time buyer would find a house for $400,00. The buyer would agree to buy the house for $220,000 with the fund covering $180,000
Critics argue the seller would merely raise the selling price. Should that happen, this new program would produce no improvement in housing affordability and potentially make the problem worse for those who don’t end up qualifying for subsidies.
Is this the proper function of government? Does it protect our freedoms and provide safe neighborhoods? In our heavily indebted cities, states and government, can we afford another government giveaway?
Paige Panzarello, the “Cashflow Chick,” Founder of The Tryllion Group, Investor/Entrepreneur having done $150 Million+ in real estate transactions; Specializing in Non-Performing Notes. She has been a regularly featured guest on “The Cashflow Guys” podcast, and you can also find her on many other Real Estate and Entrepreneurial podcasts and in the Wall Street Journal as well. She also speaks at various Real Estate Investing clubs and conferences across the country. Paige teaches the “Building Wealth with Notes” Workshop that drills down into the details of how to successfully buy Non-Performing Notes, create passive income, and mitigate risk. www.CashflowChick.com/training
Surviving the crash of 2007, Paige knows how “life happens” every day. Her passion is to help people build wealth, secure their financial future, enjoy life, and be ready-not broken! Whether it is improving communities one house at a time, assisting borrowers in staying in their homes, or working with other investors to learn a new way to earn higher investment dollars for their retirement years potentially, Paige dedicates herself and her business to helping people improve their lives in every way. For more information got to www.CashflowChick.com
by Paige Panzarello | Jun 23, 2021 | blog, investing, real estate
Frustrated home buyers are getting more frustrated with the rising prices and lack of options in the housing market. That’s according to Fannie Mae’s latest Home Purchase Sentiment Index reveals that just 35% of people believe now is a good time to buy a home, down from 47% just a month ago. Moreover, the percentage of people who think it’s a bad time to be in the market for a home surged to 56%, up from 48% last month.
Dough Duncan, senior vice president and chief economist at Fannie Mae told HousingWire that consumers are acutely aware of the higher prices and reduced supply of homes for sale. Those were “the two reasons cited most frequently” for home buyer’s sentiments, he said.
California’s Solution
Since Roman times the idea of buying votes with bread and circuses has been a staple of politicians. Vote for me, and I’ll make sure that you will receive farm subsidies and price supports. Vote for me, and I’ll make sure you’ll have free healthcare; I’ll pay off your student loans. And while we are at it, education is essential. So I’ll give you a free college education. Vote for me, and I’ll even pay you not to work. Now, this:
California Proposes Subsidy to Cover Almost Half the Cost of First-Time Buyer’s Homes
According to Realty Biz News, “Lawmakers in California have come up with a dramatic new proposal that, if it comes into being, would offer hope to first-time buyers that are struggling to find a home to buy in the state.
“California Senate Democrats have included a new program in a budget proposal unveiled last week that would massively subsidize the cost of buying a first home.”
“The California Dream for All program is a part of the Democrats’ larger Build Back Boldly program that was first outlined in April. Last week, lawmakers provided more details, saying the plan would subsidize up to 45% of the price of a home for a first-time buyer in the state, effectively slashing the price almost in half.”
Frustrated Home Buyers
The plan is a bit complex. First, the California Dream Fund would receive a one-time infusion of state and federal funds. Then, the state would sell shares of the fund to private investors who would benefit from earning tax-free returns on the appreciating value of the homes that money funds. So those investors, in effect, become silent partners of homebuyers who take advantage of the subsidy. The homeowners would be responsible for all of the maintenance costs, property taxes, and insurance premiums, and they would have the option to buy out the investors’ share in their home at a later date.
Housing Shortage
There is a housing shortage everywhere in the United States, and that shortage is causing prices to rise. A March survey found that nine out of 10 respondents considered housing affordability to be a serious problem.
How would the plan work? An example cited is of a home priced at $400,000. The idea is that the first-time buyer would find a house for $400,00. The buyer would agree to buy the house for $220,000 with the fund covering $180,000
Critics argue the seller would merely raise the selling price. Should that happen, this new program would produce no improvement in housing affordability and potentially make the problem worse for those who don’t end up qualifying for subsidies.
Is this the proper function of government? Does it protect our freedoms and provide safe neighborhoods? In our heavily indebted cities, states and government, can we afford another government giveaway?
Investor/Entrepreneur having done $150 Million+ in real estate transactions; Specializing in Non-Performing Notes. She has been a regularly featured guest on “The Cashflow Guys” podcast, and you can also find her on many other Real Estate and Entrepreneurial podcasts and in the Wall Street Journal as well. She also speaks at various Real Estate Investing clubs and conferences across the country. Paige teaches the “Building Wealth with Notes” Workshop that drills down into the details of how to successfully buy Non-Performing Notes, create passive income, and mitigate risk. www.CashflowChick.com/training
Surviving the crash of 2007, Paige knows how “life happens” every day. Her passion is to help people build wealth, secure their financial future, enjoy life, and be ready-not broken! Whether it is improving communities one house at a time, assisting borrowers in staying in their homes, or working with other investors to learn a new way to earn higher investment dollars for their retirement years potentially, Paige dedicates herself and her business to helping people improve their lives in every way. For more information got to www.CashflowChick.com
