Coronavirus Updates

Kicking the Can: Will Delaying Evictions and Foreclosures Worsen a Downturn?

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In April 2020, tenants in a single-family home I own in Texas stopped paying rent. They had all sorts of reasons, including losing their job, being sick, and having the bank hold their unemployment check.

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I was willing to wait another week with every excuse they made, given the sudden hardships due to COVID-19. I offered to let them pay rent slowly and waived late fees. Everyone was experiencing troubling times, and I wanted to partner with my tenants.

As the weeks went on, there was still no rent and more reasons for the delay in payments.

What’s Happening With Evictions?

In any case, by August, I was ready to file for an eviction. Due to the moratorium on evictions until the end of August for FHA, Fannie Mae, and Freddie Mac loans, I needed to wait.

On the day before filing, more news came.

When I heard on September 4 that the CDC had banned evictions or foreclosures until December 31, 2020, extending the ban on evictions through the end of the year, I was extremely frustrated.

I know the ban is about something much more extensive than landlords losing their homes. As an investor and property owner, I am facing challenges. For a tenant with no job, no prospects, government subsidies, and no extended family, an eviction could be detrimental to survival and create a spike in the outbreak.

The CDC is prioritizing health and safety before it considers a landlord's consequences.

Fear of Homelessness

Homelessness in the U.S. has been growing steadily and was an issue pre-COVID-19. Seventeen out of every 10,000 people were experiencing homelessness as of a January 2019 investigation. Once someone becomes homeless, it is harder to reintegrate them back into society.

What’s worse, the Los Angeles Times noted, “Mass unemployment over coronavirus could lead to a 45% jump in homelessness.” And homeless people are more at risk of getting and spreading COVID-19.

CDC and Landlords

The CDC’s ruling states that if tenants are unlawful, they won’t be exempt from eviction. The writing of all the other rules says the tenant only needs to sign an affidavit, stating they can’t work, make money, or earn a lot of money this year and will become homeless if evicted.

As a landlord, this is of course concerning. It is not clear if you can legally request documentation. This stipulation may come down to a court ruling state by state, but if the tenant says they may be homeless due to the eviction, they are currently protected by law.

Related: I’ll Never Evict a Tenant—Here’s Why

Where Is the Money?

While tenants are unable to pay, most landlords cannot afford to foot the bill.

"Stuck between tenants who can't, or simply won't pay up and banks that still expect mortgage payments every month, many landlords say the eviction moratorium puts them in an impossible spot," writes the Boston Globe. “They don’t want to evict tenants in the midst of a health and economic crisis. But they also don’t want to go broke.”

Many tenants are paying and working with landlords. Rents are 92% paid for multifamily housing as of August 17, according to the NMHC tracker.

The problem worsens from state to state and by areas hit harder by the economic shutdown. For instance, in the Bay Area, renters seem to be making payments. However, one New York Times headline reads, “31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse.’

The economy is still paralyzed, and companies continue to go out of business and struggle to survive, making it challenging to pay bills. So even if a small group of tenants takes advantage of the situation, or some cannot get through the burden, those numbers will add up.

COVID-19 Is Not Going Away

According to doctors, the COVID-19 pandemic is not getting any better, and they are calling for a reset on shutdowns. The Washington Post said, "In April, the International Monetary Fund projected that the global economy would experience a 3 percent downturn in 2020, its sharpest contraction since the Great Depression. Last week, the IMF revised those forecasts, saying that the global recession will be far worse than originally thought. New projections suggest output will drop by 4.9 percent.”

The numbers surrounding the pandemic do not support landlords seeing any relief soon.

real-estate-recession

What Happens Now?

Fannie Mae, a government-sponsored enterprise that makes mortgages available to low- and moderate-income borrowers, also sent out a press release with the news about the extension on evictions and foreclosures, saying that they were working to support homeowners. Still, it is hard to see how the forbearance will ultimately support the property owner.

Requesting a forbearance from lenders indefinitely only increases debt to the bank. All the money is going to need to be repaid, and at that point, if the tenants can’t catch up, the landlords will be faced with a troubling situation.

One viable option is lenders put the money owed into an extended loan, so instead of 30 years fixed, you now have 31 years. Otherwise, lenders can wrap the sum into a 30-year, and your payment will go up. To get one of these loan arrangements, you need to prove hardship.

Household repairs are one area where expenses are not covered, and it falls on the landlord to tap into reserves. Utilities payments can also be deferred, but if the tenant is irresponsible, never pays them, and ultimately is evicted, it could fall on the owner to make the payment.

Forbearance

I called my lender to find out about the forbearance. There are clear guidelines qualifying my ability to get three months of a grace period with no record on my credit report and no interest payments. The problem increases when I have six months of deferred payments on a mortgage. How do I pay that money back?

Also, if I want to buy another property with a loan, it may be reflected on my record that I had a forbearance. Then I could be seen as a risk to a lender.

According to a headline from CNBC, “Small landlords across America are dipping into their wallets to save their homes.” The issue with landlords’ not paying the mortgage indefinitely will lead to defaults and foreclosures when the ban is lifted.

Related: How Becoming Antifragile May Save You From a Market Crash

Foreclosures

DSnews believes foreclosure rates could as much as double next year. Studies performed by ATTOM Data Solutions were shocking: “In the most likely scenario, the number of cases somewhere in the foreclosure process would shoot up more than 100 percent, from the current level of about 145,000 to roughly 336,000 in the second quarter of 2021.”

If I take advantage of the forbearance, albeit without interest, I still owe the bank that money for three months. Once I get a performing tenant in the unit, it won’t make up for those three months of rent I lost. The forbearance will also cover your PITI, according to Nolo and my lender at Northpointe Bank.

Evictions

The Washington Post writes, “This crisis has struck the United States at a moment when millions of people were already living perilously rent-burdened. Because of stagnant wages and rising rents, on one-third four renters spent over half of their income on housing. Among rent-burdened households—defined as those that spend more than one-third of their income on housing—half have less than $10 in savings.”

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What Can We Do?

Throughout this pandemic, there have been millions of thoughts about the decision-making process. I don’t know if there is a way that everyone could win in this unprecedented scenario. There is no question these are challenging times. It is difficult for the landlord who has nonperforming tenants and for tenants whose rents continue to rise and work is nowhere to be found.

When the foreclosures and evictions start, many more will face trying circumstances. If there has ever been a time to be flexible and to get creative, it is now. It is critical to continue to stay on top of sources for financial relief during COVD-19 and to find sources of opportunity and income.

The best investors know how to move with the changing times and prepare for them. History has shown us that real estate will always be a sound investment and grow your wealth as long as you can ride the wave.

For now, landlords must weather the storm and face the hurricane ahead.

How do you think landlords and tenants can work together best despite current and future COVID-related challenges?

Let us know in the comments.

Tamar Hermes is a full-time real estate investor and educator. After building successful businesses in the retail and entertainment industries, she turned her attention to real estate with a missio...
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    Andrew Syrios Residential Real Estate Investor from Kansas City, MO
    Replied 8 days ago
    I can't see the US doing another lockdown. I think the system would just break at that point. As far as evictions and foreclosures, I don't think they'll let another 2008 happen. There's far too much political instability to add to a massive recession and millions losing their homes. I think they've decided they're going to print however much money is needed to avert this; which means we're probably going back to something like the 70's; stagflation. Hopefully they don't go so far as to implode the currency. But I suspect we'll see something much more like high inflation, high unemployment, low growth, but no major eviction/foreclosure crisis.
    Colin March Rental Property Investor from Portland, ME
    Replied 5 days ago
    Andrew, by "printing money" I assume you mean direct payments to individuals. I don't see any bipartisan support for that right now, do you? If by "printing money" you mean the buying of bonds, I don't think that will lead to CPI inflation or help people pay rent and mortgages. Theoretically, it would keep interest rates low and help support assets classes like real estate and stocks but it would create real demand in the economy.
    Andrew Syrios Residential Real Estate Investor from Kansas City, MO
    Replied 4 days ago
    If a wave of evictions or foreclosures start, I absolutely think they'll do another payment to individuals like the $1200 stimulus in April. With the political instability going on right now, there's now way they could a foreclosure crisis like 2008 on top of that and expect the United States to not just fall apart. Even still, they've been filling up the unemployment insurance coffers, which while they've been reduced, are still above normal.
    Barry H. Investor from Scottsdale, AZ
    Replied 5 days ago
    I would agree. Also, at some point, governments forcing land owners to pay for the tenancy of others with no compensation is a form of inverse condemnation. Lawsuits from property owners not being paid while their land has essentially been confiscated by the government via decree would be massive in number.
    Andrew Syrios Residential Real Estate Investor from Kansas City, MO
    Replied 4 days ago
    Yeah, there's been quite a bit of that. But I don't see them setting off a foreclosure crisis. They'll offer some relief. There's just too much instability in the system to let anything like that happen.
    Brian Shier
    Replied 4 days ago
    Very good point. Just another example that proves we don’t own property we just get to sometimes control it.
    Tamar Hermes from Los Angeles, CA
    Replied 6 days ago
    @andrew Syrios I always appreciate your insights. Time will tell!
    Paolo R. Rental Property Investor from USA
    Replied 5 days ago
    High Inflation is very good for buy and hold investors and property values go up with inflation but debt remains the same. I pray they print money also to pay us rent ...
    Tamar Hermes from Los Angeles, CA
    Replied 5 days ago
    @Paolo R. Yes, money for rent would be helpful!
    Donald Rickman Rental Property Investor from Los Angeles, CA
    Replied 5 days ago
    This.
    Charles Borrelli Investor from Palm Bay, Florida
    Replied 5 days ago
    Bingo
    Darin Anderson Investor from Victoria, MN
    Replied 8 days ago
    The 70's were great for housing. Median house price: 1970: $17,000 1980: $47,200 Alas it's not coming.
    John Murray from Portland, Oregon
    Replied 8 days ago
    In my city PDX Oregon and all of Oregon housing has been in short supply. Inventory is extremely low down 15% down from one year ago. Time on market is about 12 days, my last flip was less than 48 hours. The appreciation over the last year was about 9% and down payment is 17%. The sales price are 1.2% over list. Go figure all this out.
    Adam Perry
    Replied 5 days ago
    Caution warranted. Housing is a lagging indicator. When prices start to stall and days on zillow starts to increase it will be too late.
    Tamar Hermes from Los Angeles, CA
    Replied 6 days ago
    @John Murray Low interest rates, some people wanting to feel more settled in a home creating demand and others staying put creating low inventory due to COVID-19. Many others are struggling and unable to pay bills, but it is great you are profiting in the current market.
    John Murray from Portland, Oregon
    Replied 5 days ago
    Here is another part of the equation, wild fires in California, Oregon and Washington. Thousands of residents have just lost their homes within a few days. The largest wild fires ever recorded in recent history. The demand for housing will increase dramatically on the west coast. In my area parking lots are full of RVs, tents and other temporary shelters. There will be a huge taxpayer bailout in the coming year, this will happen. In every taxpayer bailout huge profits will be reaped. Insurance companies will limit their liabilities through the courts, large utilities will do the same and the taxpayer will bail out both of them. This has happened before and it will happen again, ain't that America.
    Alvin Sylvain from Los Angeles
    Replied 8 days ago
    A lot of this is pent up demand. Particularly places on the West Coast, it has been challenging to have new construction for a number of years. Thus, building new homes has been unable to keep up with rising demand. Add the pandemic to the mix, and you have a large population of people now working from home, many now on a permanent basis. Well, if you can work from home, you can work from anywhere, so you don't need to put up with that cracker-jack condo just because it's 20 minutes from work. You can drive a few hours to nearby suburbs and buy a 3/2 SFH with a quarter acre back yard and decent schools. That's where you're seeing most of the price appreciation.
    Dennis Adler Rental Property Investor from Augusta, GA
    Replied 5 days ago
    Thanks for pointing out the work from home demand for 3/2 SFH and decent schools. I need to keep that in mind with my next purchase in Augusta, GA.
    EJ K. from Quad cities iowa
    Replied 8 days ago
    Can we just have them pay at a later time? Garnish wages? Take to court? Put lien on things? I’m fine with going a year just as long as I can get mine after and ruin them?
    Derenda Baker
    Replied 4 days ago
    Good luck collecting from tenants. I have a drawer full of judgments I can't collect. You garnish the wages, they quit their job. Then good luck trying to find the new employer. You attach the bank account the close it. Or they just file bankruptcy. The government needs to help landlords by letting us get any tax refund, stimulus money and a way to attach any other income. Also, if they are a 1099 employee good luck.
    Craig Anthony Lender from Orlando, FL
    Replied 5 days ago
    Ruin them? are you serious or was it a typo? I pray you don't mean that because you have rougher waters ahead.
    Virginia F.
    Replied 5 days ago
    And ruin them? Wow.
    Tamar Hermes from Los Angeles, CA
    Replied 6 days ago
    @EJ K. You are expecting that non performing tenants will eventually go back to work. Yes, you can go after them and garnish wages as long as it is worth your time and hassle. If you have a good team in place to manage getting the money returned, that is always an option.
    Cody L. Rental Property Investor from San Diego, Ca
    Replied 5 days ago
    I strongly disagree. I have well over $2m in judgement for tenants I've evicted with balances (much less tenants that just LEFT owning a balance). I've tried to sell that debt to collection companies. No one wants it. Though I've had collections companies call me and say they can collected as high as 20% of my old debt. I say "Cool, so buy it for 5% of it's face value". They say "No". I say "Why". They say "because we don't think we can collect any of it". I say "Exactly"
    Rohit T.
    Replied 5 days ago
    If a landlord is willing to spend some money, can collection agencies at least help spoil their credit history? Other than spoiled credit history, is there anything else that these non paying tenants have to work about?
    Rohit T.
    Replied 4 days ago
    I meant *worry about
    Cody L. Rental Property Investor from San Diego, Ca
    Replied 5 days ago
    It'll be VERY pretty. It's when you'll be able to get rid of scumbag freeloaders that had been stealing housing from you and taking money right out of your families pocket.
    Tamar Hermes from Los Angeles, CA
    Replied 5 days ago
    @Cody L. Sorry to hear your situatiom Cody. Yes, it is pretty challenging if you have irresponsible tenants. This is why I prefaced that it is only a good idea to pursue getting the money back if you can get it and not just legal fees and aggravation.
    Colin March Rental Property Investor from Portland, ME
    Replied 5 days ago
    Cody, why would be be in this business if you despise you customers? You may want to do something that is better for your health or at least invest higher up the credit curve--maybe Class B instead of the current assets I assume you own. Offer a good product and you can probably attract better tenants who pay their full rent.
    Craig Anthony Lender from Orlando, FL
    Replied 5 days ago
    Good question Colin.
    Randy Klafehn
    Replied 5 days ago
    Everyone situation is different. Instead of placing blame on others. Perhaps you should be why you have 2 mil in judgments in the first place? It like buying a stock that you know is risking and when it goes down you get upset. Some take advantage but most are just trying to survive. Unless you come from absolute poverty you will never know what its like to make make choices between power and food. Use losses as lessons, do right by both sides, sometimes a negative situation will open the doors for something amazing. COVID will turn honest hard working people into homeless and if its comes between pissing landlords off or sleeping on the street, you know what will happen.
    Vincent Rehm
    Replied 5 days ago
    I know that nobody is thinking about the landlords. However, if we can’t evict, we shouldn’t have to pay taxes or insurance either
    Michael Casile
    Replied 5 days ago
    Definitely easy to feel singled out when your customer need not pay you, but your supplier (the bank) must be paid. When folks ask me about this, I tell them that providing housing costs money. How long would a grocery store stay in business if people could come in ... fill up the cart ... and leave without paying. Providing groceries (goods) is not that different economically from providing housing (probably best considered a service, but maybe a little hybrid). If it costs us notable $s to provide and those to whom we provide it do not pay ... we can only last so long.
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    I agree!!!
    Sherry Byrne Rental Property Investor from Ozark, Missouri
    Replied 5 days ago
    I suspect they will just extend it.
    Charles Borrelli Investor from Palm Bay, Florida
    Replied 5 days ago
    They will
    Elise Hazzard Property Manager from Saint Petersburg, FL
    Replied 5 days ago
    The first challenge to the CIC moratorium has been brought by New Civil Liberties Alliance (non-profit/non-partisian in DC), who is representing a landlord in Winchester, VA. See the press release on their site for details....nclalegal.org FYI they are a non-profit and accept donations.
    Elise Hazzard Property Manager from Saint Petersburg, FL
    Replied 5 days ago
    sorry. correction; .CDC moratorium.
    Usman Badaru
    Replied 5 days ago
    This thread making me sick? We all in this together not to make a buck. What if banks say hey we’re having a tough time too and they decide to call your loan due? We all struggling. As long as the banks don’t foreclose on me I’m not kicking my tenant out till they get a job. My tenant and I are in this together. It’s times like this we need to throw the idea of profit out the window and start doing some charity if you have the power to. And that means letting my tenant live rent free. We just tweaked the lease a lil bit, and put some more responsibility on their end.
    Tamar Hermes from Los Angeles, CA
    Replied 5 days ago
    @Usman Badaru I think you are in the right frame of mind. The struggle some are facing is when a tenant collects unemployment and does not pay or makes arrangments for payments and then does not hold up their end. It is great you where able to partner with tenants. The ones I have issues with are operated by property managers. I don't think the communication is working well.
    Derenda Baker
    Replied 4 days ago
    Amen
    Craig Anthony Lender from Orlando, FL
    Replied 5 days ago
    I agree with you Usman on some of the crass comments being made. Some of these folks sound like slum lords. The moment the moratorium went into effect it should have allowed everybody to participate, from landlords to tenants and the bank would have to be supplemented by the government since that is where politicians seem to send all our tax dollars go anyway.
    Robert Johnson
    Replied 4 days ago
    When the owners don't have the income to maintain their properties they will become slum lords.
    Robert Johnson
    Replied 5 days ago
    The bank can't foreclose on you as long as you pay the mortgage. How does that relate to tenants living in your property for free. This isn't Venezuela. If you think your idea is so noble keep buying properties and let the tenants stay rent free. Then you most likely will face foreclosure.
    Derenda Baker
    Replied 4 days ago
    How do you pay your mortgage when your tenant is not paying the rent?
    Vincent Rehm
    Replied 5 days ago
    The government shouldn’t expect taxes then either if we are all in this together
    Cory Adams Investor from Tampa Florida
    Replied 4 days ago
    ^^^ Agree Vincent and this is more true when considering that the lock downs and business shutdowns and break up of social cohesion was not the result of a virus, but the result of government actions. All future actions in relation to health concerns must be evidence based going forward.
    Ed B. Real Estate Investor from Sacramento, CA
    Replied 5 days ago
    "A Team " in place? The only team I know of-and can afford--is me. But then, I guess I'm just a slow moving simpleton
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    It’s sad, bicycling businesses is booming all from the extra $1,2000 and the $600/week most tenants got but they don’t pay rent??!! The CDC is forcing us to work for free!! I wonder how they would feel working for 6 months without a paycheck??!! Them forcing us to work for free is illegal, that is slavery and it’s unconstitutional!! If CDC is hiding behind corona, where is the federal housing, state housing and or payment directly to landlords for government’s failure to act?? Why are they forcing landlords to work for free ?? Yes, it’s OK to ask us for no evictions but pay us directly for the tenants that lost jobs due to Corona. Everyone gets compensated but landlords!! Are healthcare workers forced to work for free for 6 months?? NO! Are government workers forced to work for free? NO! In fact, is anyone else forced to work for free because of corona???!! NO!!
    Ross Aribi
    Replied 4 days ago
    Emotions aside, I tent to agree that some of the stimulus should have gone directly to landlords. The stimulus checks were intended to partially cover rent. Bad handling on part of the government in my opinion. Let's see if us landlords get a break at tax time - hopefully we get some credit or something for lost rents. Please make sure you document your losses well in case you need them.
    David Heath Investor from Floyds Knobs, Indiana
    Replied 5 days ago
    In Louisville KY there is 21 million in CARE's dollars that is supposed to be for rent assistance but the agencies will not distribute it unless there is an eviction. They are forcing the landlords into evicting the tenants before they will help. I don't want to evict my tenant and his family but they are forcing into doing it. I would like to let my tenant live for free but I have my own family to take care of. I am not in the position to also support my tenants family as well.
    Robert Johnson
    Replied 4 days ago
    It is currently a violation of the CDC order to evict someone for non-payment.
    Walter Dombal
    Replied 5 days ago
    We all choose real estate as an investment. We now whine when the investment is not going well. We all need to grow up and accept we made the choice to get into rentals.
    Cory Adams Investor from Tampa Florida
    Replied 4 days ago
    Walter, one reason that countries prospered which were nominally based on the British Common Law, was that these countries provided predictability and stability with regard to investment. This investment increases capital allocation and availability which in turn will increase the standard of living for those living in such a polity. If that trust is destroyed, investment dries up, businesses don't get formed or go under and standards of living diminish over time. It is my opinion that this action by the government will guarantee that only those that can provide housing at a razor thin margin will likely return to slum lord standards in some markets and or those that can pool large sums of cheap debt will buy up and run these properties (hedge funds?).
    Walter Dombal
    Replied 3 days ago
    Interesting put.
    Arnel Ackar Investor from Goose Creek, South Carolina
    Replied 5 days ago
    Also, no way are you a small landlord. If you were forced to pay for upkeep and mortgage and all out of your own pocket while not getting rent payments you'd think differently so maybe you should not comment on things you know nothing about and call people whiners when you have no idea what they are talking about.
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    Right on, Walter Dombal is most likely an agent for Isis or communist Venezuela !
    Arnel Ackar Investor from Goose Creek, South Carolina
    Replied 5 days ago
    I have zero understanding for your statement. The investment may not be going well but not because you as the landlord don't know how to handle your business but because the government is essentially forcing you to pay for other people to live for free. Yes I understand the reason and I agree it's a hard situation and tenants need help but if you want to help the tenants you can't just say to small landlords why don't you foot the bill for everybody. If you are going to ban evictions which are an important tool in the landlord's tool belt then you need to step up with payments to the landlords. That is the proper way of doing it, small landlords don't have pockets deep enough to rescue the US economy, the government does so let the government do it.
    Robert Johnson
    Replied 5 days ago
    The only one who needs to grow up is you. Your comment is offensive to those who have issuez with government policy. The adults in the room are not trying to be the alleged smartest guy in the room while adding very little to the conversation. Tip of the day. Why not change your name to Walter Dombell. Thank you.
    Walter Dombal
    Replied 5 days ago
    I'm not happy that the government protects the tenants and let's the landlord bear the burden. I'm saying we need to find solutions to these inevitable issues that may pop up. How about having 6 months of reserves on mortage payments on our rentals? or section 8 properties? I'm not attacking anyone, I'm just trying to offer up risk mitigation solutions that protect us during down times.
    Robert Johnson
    Replied 5 days ago
    That's not the way it comes across. But thank you.
    Robert Hernandez Flipper/Rehabber from Dallas, TX
    Replied 5 days ago
    After several tenants took advantage of me in 2004, I have ALL my 71 sfh rentals on the Section 8 program. We receive 90% of our rent payments without delay. Other non-Section 8 property tenants pay every 2 weeks or as they can. Not an issue.
    Walter Dombal
    Replied 5 days ago
    A sound solution to a problem, good job!
    DWAYNE W. from Severn, Maryland
    Replied 5 days ago
    CLASS ACTION is the only way for small landlords to get any relief here. We have been hung out to dry with no relief from the GOV. They are clearly violating our right to run our business, PERIOD!
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    I agree, I am ready to sign up. It’s a clear violation of our constitution and human rights against slave wages!!! I now work for free! CORRECTION I work for loosing!!!
    Robert Johnson
    Replied 5 days ago
    No doubt about it.
    Dave Mason from Arvada, Colorado
    Replied 5 days ago
    My position has always been know everything you can first hand when the opportunity presents its self take it. To that end I have hired attorneys for evictions and collections. I have preformed pro se in both areas. I have filed claims in BKs prose and followed through in Debtor hearings. The more experience I have the less I lose. My loses are in the single digits. If I had a couple million sitting around I would follow through with whatever it took. Yes time is money but experience is the most valuable opportunity. It sounds like a nice side income. No one else has your motivation or understanding of each situation. There are very few aspects of real estate investments I have not explored hands on. Everyone of them lends to the ability to handle whatever the market throws my way. This may be a great time to rurn tenants into flips. The money is lose and becoming more available. Eliminating your debt before this unprecidented collapse occurs leaves you in the last man standing position when the market becomes clear again. Instepped out for a couple decades waiting for this moment. The S&L crisis was great but I was a babe. Now all of the fish in the barrel are mine.
    Robert Johnson
    Replied 5 days ago
    If the tenants aren't paying you why would a bank take a chance on them? Also, your cynical view may come to pass.
    Robert Johnson
    Replied 5 days ago
    How can two groups who have been issued a government edict work well together? The answer lies in who holds the power and it's not the landlords. The temptation by tenants to stick it to landlords will only grow more tempting. There was an article in the local paper about some tenants who had paid promptly for three years then immediately stopped paying under the state moratorium. When the moratorium expired the landlord filed for eviction. They moved out after destroying the entire inside of the house, over $100,000 in damages. Now the government has turned landlords into mini-me welfare groups, forcing landlords into crushing amounts of debt while deadbeats/ non-payers have control of their properties. If the moratorium is extended through June, many mom and pop landlords will go under. There is no way this is constitutional. The government has now seized millions of properties and without due process. I imagine that somehow it will eventually be overturned. I also imagine some landlords will walk away and turn in the keys if this goes on for 18 months. Utility companies will also get stuck with plenty of non-payers. This is a disastrous policy which will only serve to drive rents higher when its over. It will ruin many short sighted tenants because no one will rent to them after it's over. Landlord referrals and credit checks will rule the day. I have 7 units and 5 units payments are up to date, 1 unit is vacant and one is late this month and I think she thinks the moratorium will protect her and it will. She might pay. She's rented from me for 5 years but greed is a funny thing. The 1 unit is vacant because a tenant moved out in March and I won't rent it while there's a moratorium. In fact I might sell everything because of this incident. If you can't trust the government who can you trust? I predict skyrocketing rents as many mom and pop landlords exit the business and the number crnchers take over. Those tenants who couldn't pay for whatever reason will end up in homeless shelters because who in their right mind would take a chance on them? Work together? When the government can seize your property without due process you have no right to claim any high ground. Therefore, under the law you've become a nobody so why would anyone respect you enough to work with you? Since March, 2 former tenants have contacted me to see if I have any vacancies. I told them I have none and it's true. What I have is a vacant unit that the government can and will seize and right now there's not much I can do about it.
    Chip Douglas from New York, New York
    Replied 3 days ago
    I also believe that a HUGELY undervalued part of any system has to do with rewards and consequences. Natural (not gov-induced) hardship can be brutal, and also very instructive. You learn lessons that change your behavior going forward. You don't learn those lessons with a bailout. We are seeing a scary new precedent in which the gov steps in to rescue banks and other businesses, ag and entire industries, now tenants... unless there is a national security threat or a survival response to international trade activity, the province of gov should NOT be preventing people from learning lessons. This is different in that it's a virus, but the same in that it has caught out over-leveraged renters and landlords. Bailouts help to ensure that what might be a necessary pullback on both sides never comes about. Not to mention, the idea of a central gov unilaterally declaring my property to be their own insofar as I'm not allowed to collect/evict on it, overrides any other consideration wrt to the learning experience for renters/landlords.
    Howard Mintz
    Replied 5 days ago
    It is a real hardship for small landlords with outstanding debt. How could one possibly foresee a 8 month moratorium on rent payments. As usual, the government does not think of the extended consequences of its actions. Maybe there should have been an implied link between delay in rent and delay in mortgage payments? The banks always are made whole, maybe the mortgage holders should now get a reprieve? I don't believe that persons not making rental payments for 8 months have any intention of repaying outstanding rent to the landlord.
    Robert Johnson
    Replied 5 days ago
    They won't but essentially they will find it next to impossible to get another unit to rent once they are evicted unless they find a sucker who doesn't take precautions.
    Walter Dombal
    Replied 5 days ago
    We all choose real estate as an investment. We now whine when the investment is not going well. We all need to grow up and accept we made the choice to get into rentals.
    Carey Nuyen from Geneva, Illinois
    Replied 5 days ago
    I told you once to SHUT YOUR MOUTH!
    Marie Pruden
    Replied 5 days ago
    Let me give you an example – me. I’m a 77-year-old widow with a disabled son, living on a small fixed income. I only have one house – where I and my disabled son live. When my husband died a few years ago, I was left paying the mortgage on my own, which I was able to do without fail with the help of a good tenant renting my basement apartment. Then the pandemic struck and with it, an eviction moratorium mandated by Governor Newsom in late March. Suddenly my tenant stopped paying rent. She said she lost her job. At first I felt it was all right, since I thought the rent moratorium would last only for one or two months, which I can afford to lose. But it didn’t. Gov. Newsom’s eviction moratorium that was supposed to last until May 31 was extended to 90 days by the California Judicial Council. The Judicial Council even closed down all eviction courts, so no cases can be filed. When some landlords complained that judges, being unelected officials, should not be legislating, the California legislature stepped in to deliver the coup de grace – the fatal blow. Now legal, the legislators extended the moratorium indefinitely and even forbade landlords from collecting rent until -- something like 15 months AFTER the Governor would have lifted the state of emergency. How do you count 15 months from an indefinite date? How do you fight a government when all its three branches - executive, judicial, and legislative - have joined forces against you? My mortgage is not federally-backed, but my lender offered me forbearance, for four to six months, after which I will have to pay double to make up for the missed payments. Meanwhile, I still have to pay for insurance, taxes, utilities, maintenance and other bills, while my tenant lives rent-free. I am not eligible for the PP help offered small businesses because I have no employee. I call outside help whenever I need to have something fixed. At the rate this is going, I may have to go into foreclosure or try to sell the house, which I really, really, don't want to. Selling the house is not as simple as it seems. In the past, there had been investors offering to buy my house. Lately, though, they have all disappeared. They backed off after they learned my property has a government-protected non-paying tenant in my basement, and therefore, not generating any income. I don’t know what the government is trying to do, but it feels like it’s driving me into homelessness, just so my tenant will not be homeless. Have you heard of rioters demanding “cancel rent” or insisting that “Housing is a human right, therefore it should be free?” It seems the government has caved in to their demands at the expense of small landlords. Small shop owners who have been looted are not expected to continue replenishing their shelves so looters can loot them again. Shop owners also have the freedom to close down if they think they can no longer stay afloat. But not so with small landlords. They are forced by the government to keep their businesses open so tenants can continue “sheltering” during the pandemic. Scour the internet and see that all sympathies are for the poor tenants. Landlords are even vilified for being “greedy,” and, in the case of someone in this thread, urged to “separate your emotions from rainy day reality.” Yeah, a government-imposed rainy day. Can’t they even lend a modicum of sympathy, such as, “I can’t believe this is happening in America?” Meanwhile, my non-paying tenant is driving a new Volvo.
    Chip Douglas from New York, New York
    Replied 3 days ago
    Great (if awful) story. More such stories need to get out there; it's always a tenant sob story because tenants are the only ones with bills and consequences. Yet I don't sense the press are sympathetic to plights like yours, so here are a few more something-for-nothing requests from tenants. On some level we all understand eviction moratoria to be a total violation of the Rule of Law, not to mention several articles of the Constitution, yet Americans collectively tolerate it as there is this vague sense that landlords must be well-heeled, not to mention unlikable caricatures.
    Robert Johnson
    Replied 5 days ago
    Welcome to Venezuela and no passport required. I believe the bank will be overturned by a federal court and will eventually find its way to the Supreme Court where the justices may uphold it as long as landlords are compensated. In the meantime the political class found a solution to the issue at your expense so they don't have to raise taxes.
    Marie Pruden
    Replied 4 days ago
    @Robert Johnson, Not quite Venezuela yet, since it's presently affecting only a sub-group of people -- us, the landlords. We are not as numerous as tenants, and we don't deliver as many votes. But it's a start. I used to think it would be the Green New Deal that would do us in. GND has this brilliant idea that would order all houses to be retrofitted for climate change. Homeowners who can not afford to, will be helped by the government retrofit their properties. But first, homeowners will then have to be moved and housed in big communal apartments while the government retrofit their houses. And they will never see their properties again. It was a horror film that started in my mind after reading GND. But - as luck would have it - they don't need to wait for GND now that the pandemic is here. They can, and have started, with stealing landlords' properties and giving them away to "poor tenants." So, you're right, Robert. Venezuela, here we come.
    Marie Pruden
    Replied 4 days ago
    @Robert Johnson. Thank you, Robert. I hope with your posts, Dombal, March, Badaru, et al. in this thread will begin to understand that it’s not that landlords are unable to take the gut-punch and therefore should not have gone into landlording. It is that we were able to, until the government interfered and took away our ability to punch back. And yes, I’m hoping and praying that this matter will reach the Supreme Court. Yours is a very rare comforting thought I find in the internet, thank you. “Working together” with my tenant just isn’t working. All she does is say she has lost her job, her unemployment hasn’t come through, and that she hasn’t yet found another job. And I can’t really blame her for not paying, because California government says she does not have to. Lately my tenant and I have avoided communicating face-to-face for fear it would lead to a fight. So we have been exchanging letters, which I like because then I am able to save her letters for (I hope) a time in the future when we might have to show the authorities proof (or her claim) of financial hardship. But I’m not holding my breath. All I can do is pray. Thanks again, Robert. God bless you.
    Tamar Hermes from Los Angeles, CA
    Replied 5 days ago
    @Marie Puden I am sorry for your hardship. This is why we have a forum to share and have conversation. It is very frustrating to be a landlord with tenants who are not paying because they don't feel they need to. It puts landlords in a very tough situation and we are being forced to be bills with no recourse. The laws in California are brutal as you cannot evict for a year. Keep trying to reason with the tenant and explain your side. My understanding is that you can evict and at the court, they will need to prove they looked for work and did not collect unemployment.
    Marie Pruden
    Replied 4 days ago
    Thanks, Tamar, for your kind thoughts and opening up this forum. You’re right – non-paying tenants in California may be evicted only after one year – that will be from 12 to 15 months of non-payment after Governor Newsom will have lifted the state of emergency. And when will it be lifted? How do we count one year from an indefinite date? The eviction courts have opened up but are not taking any new cases. They are working on the backlog of cases that date back from at least November last year, so I heard. I also heard (though can’t confirm) of landlords’ attempts to sue the state government in federal courts, but such attempts have been unsuccessful because federal ruled eviction moratoriums to be legal. When I consulted a lawyer as to the possibility of my joining a class action suit, he said small landlords may not be warming to the idea of spending enormous amounts of time and money for the comparatively smaller back rents they are trying to recoup. Worst case scenario: If I default on my mortgage and the bank tries to evict me from my property, I will not move. Just as my tenant will not move, either. Lord, help us.
    Cory Adams Investor from Tampa Florida
    Replied 4 days ago
    Marie, I am sorry to hear about your circumstances. Perhaps you could ask your tenant what it would take monetarily for her to leave? If you are able to get that number, then maybe you could appeal to investors in order to sell your property?
    Marie Pruden
    Replied 4 days ago
    @Cory Adams. That’s an idea. Thank you, Cory, for the suggestion, but I really don’t want to sell my house. And I don’t want my tenant to leave, either, if I can help it, because she was such a good paying tenant before the pandemic struck. I was hoping it all will go back to where we were, once this weird emergency situation normalizes. I still owe about $150,000 on my house. The original price was $600,000 when my husband and I bought it in 2005, in a city between San Francisco and Sacramento. We like it because I can’t drive and it’s only a half-block walking-distance to our church. It has a large garden and backyard with fruit trees. And the view - I don’t own the view, but it’s a million-dollar view of SF Bay. I was looking (not too seriously) in another city where I like a particular church (one that offers the Latin Mass), where I thought I might want to buy a much scaled-down house for half the price of what my house originally cost. But a much-smaller house would make me pay three times the amount of what I am paying for monthly mortgage now. So much for down-sizing. But, thank you, Cory, for your kind thoughts. I will keep in mind your suggestion if I feel I can no longer carry this burden. Please pray for me. God bless you.
    Robert Ware
    Replied 5 days ago
    100% agree. Well put
    Robert Johnson
    Replied 5 days ago
    What a stupid comment. The only difference between someone who robs you on the street with a gun and the government is that when the government robs you like this they are wearing a uniform. And in case you don't know it the constitution states you have a right to complain under the First Amendment for redress of grievances.
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    i agree , Walter D, is obviously an agent of tenants rights! If he had any properties at all, he would not say such a garbage!
    Walter Dombal
    Replied 5 days ago
    Ron, I do own rentals in multiple states. I'm just saying we need to have risk mitigation strategies in place to protect us landlords from events like we are experiencing.
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    I seriously doubt that u have any property! Otherwise you would not say such a nonsense! It would be better to tell everyone in the USA to work for free for 8 months than this one sided , unconstitutional moratorium on evictions that is just plain discrimination against those perceived wealthier! The CDC is acting on behalf of the government that is affraid of the tenants demonstrations!
    Peter F. Investor from Miami, Florida
    Replied 5 days ago
    I think that if the government decides that a moratorium on rents or evictions is necessary for society in the face of this threat, then let them spread the burden among all of society and raise taxes to pay for it. Singling out and letting the burden fall on landlords alone is outrageous.
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    I agree, government failed to provide housing for unemployed and now forcing landlords to illegal moratorium on evictions!
    Robert Johnson
    Replied 5 days ago
    The Fifth Amendment of the United States Constitution includes a provision known as the Takings Clause, which states that "private property [shall not] be taken for public use, without just compensation." While the Fifth Amendment by itself only applies to actions by the federal government, the Fourteenth Amendment extends the Takings Clause to actions by state and local government as well
    Cory Adams Investor from Tampa Florida
    Replied 4 days ago
    Robert I agree with your assessment. Courts have dismissed these claims on behalf of landlords by saying that it wasn't a taking because the action was only temporary and thus landlords have not 'lost' control of their property! I don't see how the government wins these cases if they go to trial as the evidence will simply not support the following scrutiny to justify a taking or partial taking : The government would likely assert the defense of public necessity. This defense requires the government to show: (1) an actual emergency, (2) imminent danger, and (3) actual necessity of government action. Good detail can be found here on the possible avenues to approach the actions taken by various government agencies https://www.gibsondunn.com/constitutional-implications-of-government-regulations-and-actions-in-response-to-the-covid-19-pandemic/
    Charles Borrelli Investor from Palm Bay, Florida
    Replied 5 days ago
    https://www.cebm.net/covid-19/declining-covid-19-case-fatality-rates-across-all-ages-analysis-of-german-data/
    John Stroud Investor from C-BUS
    Replied 5 days ago
    I don't understand why this is even remotely stressful. In a situation where you the investor can't afford "something" you either be responsible and sell it on your own or someone will take it from you provided there is a note on it. Just sell the property with non-paying tenants...take the equity cash from the sale and learn how to separate your emotions from rainy day reality.
    Derenda Baker
    Replied 4 days ago
    What if you bought your property in 2005 for 240k put 20% down and have made all your payments but ir is still upside down because of the economy. To sell you would lose all your down payment, all your payments that have been paid and have to come up with another 25k to sell it. And since you haven't been getting any rent since March you are now another 14k in debt. You tell me how to sell my property.
    Robert Johnson
    Replied 5 days ago
    When someone seizes your property without compensation and you're not stressed or concerned you're either a fool or just plain obtuse.
    Donovan Bartlett
    Replied 5 days ago
    Agreed John! Its a great time to refi pull cash out to weather the storm if you need. Protect your credit and get ready rebuild. There will be big opportunities coming to help and make good money
    Robert Johnson
    Replied 5 days ago
    What bank will lend yiu any money if yiu don't have proof of rental income? I just purchased a new house and the bank demanded proof of rental income up to the week before settlement.
    Walter Dombal
    Replied 5 days ago
    Agreed!
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    What emotions r u talking about?? We r talking about illegal unconstitutional moratorium on evictions. Would u not protest if the government told u that u have to work for 8 months for free????
    Peter Malone
    Replied 5 days ago
    The political atmosphere in certain parts of the country are not looking up for residential/multifamily Landlords. I believe that trend will only get worse as landlords will be the new pawns in the current environment where local or state governments will limit a landlord’s ability to pass on capital expenses let alone trying to increase rent to keep up with inflation. I’m working with a client right now who is repositioning and selling his entire multifamily portfolio and moving all of his investments into industrial properties with 9+ cap rates. He lives in L.A. and wants to be out of his CA MF investments with his portfolio north of $25 million. Not all markets will have this issue of the state limiting landlords ability to make a profit but the trend is not favorable overall. Investors may need to look at new real estate asset classes that won’t become the new whipping post of progressive social policy.
    Carey Nuyen from Geneva, Illinois
    Replied 5 days ago
    Hey, Peter Malone, great idea, hows about we form a new "Real Estate" class? Whipping Posts, to tie these people with progress Ideologies to, then have at it with their hides! The lady with the house at 77 years old, she is SCREWED! There is NO refinancing with fixed income. What? She should refinance to pay for the tenant with the new Volvo in basement to continue to live there? This is going to end VERY badly for many. This fight is coming to all of our front doors!
    Marie Pruden
    Replied 4 days ago
    Thank you, Carey Nuyen, for understanding my situation. Please pray for me and others who might be in the same boat. God bless you.
    Robert Johnson
    Replied 5 days ago
    I agree. I think that's where it's headed.
    Eric Crespolini Attorney from The Northeast
    Replied 5 days ago
    I really don't understand some of the utter disgust that some people are expressing here for their customers. Almost everyone is hurting right now for one reason or another. Sure there will be some tenants who will take advantage of the eviction moratorium because they can, but of the handful of tenants that have stopped paying me its because they truly can't. At the end of the day the non-payment is absolutely crushing my margins, but I operate as a business so we are getting by because while nobody planned for a pandemic we do plan for big disruptive events. In some ways I'm glad that moratoriums have given us a chance to hit pause and see if we can find a footing, because if people were actually getting evicted right now, the market rent would in my markets would be getting absolutely destroyed (which would cause my business much bigger long term effects).
    Robert Johnson
    Replied 5 days ago
    It is disgust with a policy and certain tenants who take advantage of that policy. If someone robbed you on the street for a $1,000 a month are you telling me you wouldn’t be disgusted? What's the difference? As far as customers customers pay and many tenants aren't paying.
    John Teachout Rental Property Investor from Concord, GA
    Replied 5 days ago
    For some of our late/non-paying tenants, I'm 100% sure their annual income is the highest they've ever had with the stimulus and enhanced unemployment. Did we get rent shortly after the stimulus checks hit their accounts? Nope, don't know what happened to those funds but they didn't come our way. Thankfully, we've received all rents through June, all but one property through August and are going to be 3 properties unpaid in September. Two properties we've already filed pay/quit notices and will start filing in the courts this week if we don't get paid by Monday. None of these delinquent tenants would put a gallon of milk on the belt at Walmart and think they could get it for $1.00 instead of $3.39. Not sure why rent is not considered a "required" cost. We've run out of patience and although we've never filed an eviction we are rolling up our sleeves to do just that.
    Robert Johnson
    Replied 5 days ago
    Unless your tenants are violating some other provision of the lease how will you file for eviction? Be careful, those criminal penalties and fines are eeal.
    John Teachout Rental Property Investor from Concord, GA
    Replied 5 days ago
    And commenters saying things like "you should have reserves" and other dumb stuff are not realizing the impact that these eviction moratoriums are having on the normal housing industry in this country. Many tenants aren't in a situation where they "can't" pay rent but are thinking they "don't have to" pay rent. We don't have many of those but the few are going to go. We live on our rental income, it's not a side gig for us, it's our whole paycheck. We're going to defend ourselves.
    Dennis Adler Rental Property Investor from Augusta, GA
    Replied 5 days ago
    Help me with one idea. . . what happens if I sell the SFH with the non-paying tenant? Does the CDC order apply with change of ownership? It would seem like the tenant would be forced to move since he/she doesn't have a contract with the new owner.
    Robert Johnson
    Replied 5 days ago
    Nope. The moratorium supercedes everything.
    Erik Stenbakken Investor from Nortnern Colorado
    Replied 5 days ago
    With a moratorium till end of 2020, this is going to be hard for most landlords. However, if it's extended well into 2021, it will become unsustainable. All margins will be gone, and it will be essentially the government using private owners to provide free public housing, paid for by landlords. If that happens, we've just yanked the principal of private ownership out from under millions of landlords. Yes. I think a pause for a few months may be necessary (but hard) in limited circumstances. But if it continues beyond that limited scope… we're in for some very, very interesting times. And no, as a landlord I did NOT "sign up for this." When I signed up, there was rule of law. One of those laws said I could have a lease and the civil government would enforce that (the whole concept of binding contracts). That rule of law said I have obligations to my tenants and they had obligations to me. This new game says only the landlord has obligations. This current state of affairs is absolutely not what anyone signed up for.
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    Erik, I agree with you 100 % The CDC self declaration ignoring constitution correlates with COMMUNISM, yet even during communism the tenants were obligated to work, so they can pay the rent to the state. Believe me, I know, I grew up in that crap!
    Valerie Cudnik
    Replied 5 days ago
    The CDC doesn't have any authority of banking... Are your wires crossed?
    Calvin Mclean
    Replied 5 days ago
    Lol hello I have a rental I would like to sell because I have renters living in it that do not have to pay or leave if asked . I’m willing to sell it to the first sucker err I mean investor that has the cash
    Derenda Baker
    Replied 4 days ago
    If you find that person. Send them my way. I've got 4 places I will sell them.
    Michael Haynes Investor from Tampa, Florida
    Replied 5 days ago
    Hello BP "Optimisits" The Third Amendment to the United States Constitution places restrictions on the quartering of soldiers in Private Homes without the owners consent, forbidding the practice in peacetime.
    Adam Ulery Investor from Safety Harbor, FL
    Replied 5 days ago
    Here's what investors can do to take action. Please contact your members of Congress TODAY before it’s too late and tell them to pass emergency rental assistance and not eviction moratoriums! https://www.naahq.org/advocacy/action-center/advocacy-365
    Derenda Baker
    Replied 4 days ago
    Amen or give the stimulus checks to the landlords for the tenants.
    Marie Pruden
    Replied 4 days ago
    Adam, I have done that early on. I have written my state assemblyman and senator, the governor, the California Judicial Council, my US congressman and senators, even the mayor of my city -- asking to help pay my tenant's rent. Only the mayor answered. He said he can't help as the city has no funds for such. He suggested I borrow money from relatives or friends, or from the bank, or ask money from my church. Not one suggested that my tenant should pay the rent. The forever eviction moratorium = rent moratorium. Non-paying tenants in California - whether unable or unwilling - may choose not pay rent because government says they don't have to.
    Michael Haynes Investor from Tampa, Florida
    Replied 5 days ago
    Again hello to all BP "Optimists" The difference in the French or European Rule of Law and the US Rules are that in Europe and Canada, they strive for Equality or Socialism. In the USA we strive for Liberty and Freedom especially in our Private Property Rights which are being trampled on with the Moratoriums on Rents. The 2008 Collapse of our Economy by the Government supporting the Banks and not allowing them to just go Bankrupt just killed the Middle Class and put the burden on the Poor to pay. The solution to our current crisis is to just let everyone go back to work, anyway that they can. I just sold my Commercial property in S. Tampa and cleared $340,000. I wanted to get out of the Tampa City Limits for some Peace and Quiet. I paid Cash for a 3/3 Townhome with garage and pool in Valrico. Then, I paid off the mortgage on the 12 year Rental in Tampa that I had just lived in for 2 years to make it a Tax-free Sale of my Residence. I was thinking of Renting for a year or two and then Sell, but, there is no way in Hell that I want to get back into the nightmare I went through for 12 years with Tenants who lost their JOB's and could not pay the Rent. Martin Armstrong says that if you really want to see the Future of the USA, you just have to watch what happens in Europe and how long it takes them to go completely Socialist and Bankrupt. The whole World is in a Race to the Economic Bottom because they cannot pay their Debt.
    Bill Wilson from Longview, Texas
    Replied 5 days ago
    Today I saw a FB ad about combating evictions in San Antonio, Texas. It showed a federal government form that tenants had to acquire and fill out to avoid getting the boot. Think it was in triplicate so the landlord, state and Feds each got a copy. The tenant had to agree to paying what was possible and agreeing to pay in full past due rents. They can be evicted for not getting the form or for not agreeing to be responsible for past due rents. Texas has stringent laws that protect all property owners and landlords.
    Ron Strand Investor from Little Rock, Arkansas
    Replied 5 days ago
    What a joke!!! Any tenant will easily sign that. Most of them don’t worry about their credit and penalties etc. as we do. They can’t go to jail for owning landlords thousands of dollars. The tenants will agree to anything and everything, so they can get another free ride. There is NO penalty that they worry about because their credit is already ruined and there is NOTHING that landlords, state or feds can do. The federal form is a joke, it’s just to make naive landlords believe that it’s something!
    Richie Thompson Investor from Lansing, IL
    Replied 5 days ago
    I have a question I’m in Illinois. I have a fully rented 4 unit building I just closed on. I need to not renew a lease in order to move in (I know I wish was an open unit) but I have to not renew a lease. If they decide not to move out would it be possible for me to evict or I would be stuck and possibly not able to move in nor evict and they can possibly not pay either?
    Robert Johnson
    Replied 5 days ago
    You got it right. They aren't going anywhere. As far as cash for keys that could get expensive since they know they can't be evicted until January and even then it will take 4 to 6 more months for local jurisdictions to react. The tenants have more rights than you right now.
    Rebecca LeFevre
    Replied 5 days ago
    This sounds like one of those scenarios where “cash for keys” is a much better option than eviction
    Josh Edelson Rental Property Investor from Mill Valley, CA
    Replied 5 days ago
    I have 10 loans (positive cash flow properties out of state) and put them ALL into forbearance. This is an amazing opportunity for investors. You can be in forbearance for up to a maximum of 12 months (extending every 3 months). During this time, you don't have to pay any of your PITI. And although you still owe that money, the entire amount can be put on the back of the loan to be paid when the loan is paid off through a sale, refi., or on the last payment of the loan with NO interest! Essentially, all the money you save is like getting a free cash-out refi against your property. AND, at the end of the forbearance process, you can modify your loan to lower your interest rate and go into a different program like a 40 year. I was considering writing an article about it as I've studied it extensively, but just haven't gotten around to it.
    Robert Johnson
    Replied 5 days ago
    How will that help those whose tenants are not paying the rent? It just delays the inevitable. And you forgot to mention it could affect your credit rating.
    Michael Haynes Investor from Tampa, Florida
    Replied 5 days ago
    Walter Dubal and Robert Hernandez would agree with the rich guys who want the Government to pay everyone a "Living Wage" and just forget about the masses having to work for a living? The Government = Socialists...think that they are smarter than you and can run Your Life better than you can. When I worked in the Oil Field, they said that in Saudi Arabia you get Health Care and free University to study anything you want. At 18 years you get a free Apartment and at 21 a free Mercedes. At that point you are supposed to be able to start your own Business where you are able to Hire Foreign Workers to run your Business. That is why there are so many Phillipinoes in the Arab States. Is that what we want? The reason the King does this is to keep his population from Revolting against his family owning all the Oil Revenues. The reason the Emperors of Rome invented the Coliseum is to have Sports for the masses to keep them from revolting against the Government. The Marxists are rioting in the streets in our USA because they think that the only way to change things is to destroy the current System and just take what they want instead of working honestly for it. I was just talking with my trading partner because he is caught up in all the details about abusing the Police, restricting their ability to enforce Law and Order. I told him, like with all the BP members comments, that the bigger picture is "what are you going to do when the Criminals stop burning down the Center of your City and go for your Rentals and Homes in the Suburbs?" Do you have a gun and are you willing to stand in front of your Home and shoot to kill if you are attacked? I was in Chile 40 years ago when they killed Allende and there was Martial Law in the streets. I was in Buenos Aires during the Dirty War when they were throwing University students out of planes over the River Platte and we had Martial Law. At that time it was the Police who would stop you in the street if you were out after the Curfew and rob or kill you. The Marxists that are causing all the destruction in the streets are going to get just so far in the Leftist run States and Cities until Martial Law will have to be declared. Survivalists know the Mad Max Scenario to follow and they have their Bug Out Plans and Guns ready to go. What do you have? 1000 Doors like Robert Kiyosaki? And what about the Sindicators? Worst case Scenario? We all wait to see.
    Robert Johnson
    Replied 5 days ago
    Great comment.
    Joseph M. Rental Property Investor from Sacramento Area, CA
    Replied 5 days ago
    You should add one thing to the following: ...The Washington Post writes, “This crisis has struck the United States at a moment when millions of people were already living perilously rent-burdened. Because of stagnant wages and rising rents, on one-third four renters spent over half of their income on housing. Among rent-burdened households—defined as those that spend more than one-third of their income on housing—half have less than $10 in savings.” You need to add that these "rent-burdened households that have less than $10 in savings" also have the newest iPhone or S20 Samsung, never miss a payment on their cell phone bill, play the system like a violin and if no longer paying rent do not have an incentive to look for work. The best thing you can do in this environment is have an open communication with your tenants and make sure they understand that you are also having hardships too.
    Robert Johnson
    Replied 5 days ago
    Why would they care?
    Dennis Tierney Investor from Omaha, NE
    Replied 5 days ago
    This is clearly gov't confiscation of private property. We have only 1 way to get the gov'ts attention and that is to stop paying property taxes rather than the mortgage. Lack of income is the only language they understand. We also need to switch over to month to month leases so that when the tenant stops paying we can just not "renew" the lease so they can be evicted for trespassing and not for lack of payment.
    Robert Johnson
    Replied 5 days ago
    That won't work and could get you arrested and fined.
    David Heath Investor from Floyds Knobs, Indiana
    Replied 5 days ago
    My tenant I can't evict and says he can't pay the rent but just got a new Cadillac Escalade without a trade in. Are the car lots having to give new cars away due to Covid-19?
    Kelly Sennholz from Denver, Colorado
    Replied 5 days ago
    Call your legislators. Tell your story. Get 5 friends of yours to call their legislators. Have a solution ready, a detailed solution. Massive corporations are being bailed out because they know how to pick up the phone, tell their story and offer a solution.
    Robert Johnson
    Replied 5 days ago
    They are getting bailed out because they know how to bribe members of Congress.
    Carey Nuyen from Geneva, Illinois
    Replied 5 days ago
    Dennis Tierney, above I said the exact same thing! This is all planed out and has been. This is how they intend to take YOUR assets. And the Foolish trolls in the blog that talk about "mitigating risk" and having a plan for such things, well this has NEVER happened before. We had the rule of law, this is all part of the Socialist takeover wet dream that a certain political faction in this once great country has adopted. There are two sides, you have to pick a side! I agree with the property taxes. They have this BS that they pay for the schools. The same schools that got infiltrated long ago by this ideology we are now seeing bear down upon the property owners. They HATE private property! If the squatters don't need to pay or repay rent, then we don't need to pay for empty schools! These Teachers unions are running this whole show with the property taxation stop paying en-mass and then we shall see how it goes. I think the de-funded Police will likely not want to evict you from YOUR home when you have had it paid off for decades. unless they get the profits like many do from the sale of it. Better VOTE because it will be the last time you will get to do so if this continues!
    Colin March Rental Property Investor from Portland, ME
    Replied 4 days ago
    Carey, who are "they" in your comment? The Trump administration hates private property? The Trumps/Kushners hate landlords? What are you talking about?
    Cory Adams Investor from Tampa Florida
    Replied 4 days ago
    Nailed it.
    Robert Johnson
    Replied 5 days ago
    Yeah
    Guy Azta Investor from Los Angeles, California
    Replied 5 days ago
    Very well written and balanced article. Nice to read! Sorry you have a non-paying tenant. Props to you for being level headed about it
    Robert Johnson
    Replied 5 days ago
    Level headed now. Wait 5 months.
    Tim Silvers from Las Vegas, Nevada
    Replied 5 days ago
    Perhaps some hope here: There are proposed bills pending that would provide relief for landlords and lenders to file claims for loss of rent and mortgage payments. These need to be put into law in order to maintain the backbone of our entire system since outside of food, shelter is the at the apex of our entire economic system.  Here's one: https://omar.house.gov/sites/omar.house.gov/files/Omar%20-%20Rent%20%26%20Mortgage%20Cancellation%20Act%20-One%20Pager%20and%20Legislative%20Framework.pdf
    Albert Hall from The Plaza
    Replied 4 days ago
    Like someone said above we should be contacting our representatives daily. Try twitter. Perhaps they read it perhaps not. I contacted my senators in Texas through their websites and one (Cornyn) sent back a canned letter which was irrelevant to the subject the other (Cruz) did not respond. I have been saying since this started they are stealing private property and providing landlords with zero compensation. Where are the apartment associations? Don't they have lobbyist? The idea that this should be planned for has nothing to do with theft of private property. These types of comments are part of why the people making the decisions believe this theft has limited affect on property owners and can continue. The data says collections were at 92% in August. So the politicians say "property owners can take it. they are collecting 92%". Until their property taxes are affected they don't care.
    Jonathan Barr Rental Property Investor from Los Angeles, CA
    Replied 4 days ago
    I think in areas where rent on avg. is less then 1,000 there will be a lot less evictions and issues.
    Albert Hall from The Plaza
    Replied 4 days ago
    @Jonathan Barr Based on what?
    John Murray from Portland, Oregon
    Replied 4 days ago
    The forbearance crowd that put their loans in forbearance may have a great idea until the 2020 tax year is calculated. The IRS will love you for paying taxes on your profits. RI is all about minimizing taxes and increasing profits. You just tanked one of the huge benefits of RI. The added benefit is the principle just tacked on your loans, which is not tax deductible. It is all about taxes and how to manipulate to minimize your tax liability.
    Colin March Rental Property Investor from Portland, ME
    Replied 4 days ago
    John, principal is never tax deductible and it's not "tacked on" in a forbearance, it's deferred to a point in the future. If a borrower truly has vacancy owing to Covid and banks allow forbearance, how can that be worse than default?
    Alicia Ortiz Real Estate Investor from Portage, Indiana
    Replied 4 days ago
    It is my opinion that most of these eviction stats are coming from Eviction Lab, which are totally false and why numbers seem to be higher out east where they are located at Princeton University. They also have backers with deep pockets, Zuckerberger, Gates, Ford just to name a few. One of the places I mainly invest is South Bend, Indiana, stats there are saying 42% of 17,000 plus renters have the potential to be homeless. Here is the article https://www.southbendtribune.com/news/local/advocates-fear-a-wave-of-evictions-in-south-bend-area-after-government-help-ends/article_ee9c537c-f450-11ea-96bd-5bae6e93d8f4.html?utm_medium=social&utm_source=facebook_South_Bend_Tribune&fbclid=IwAR2YD1bQtRyuOimUs2qhU7bgLOMjcpsvw0oX2UbPp0yr7xG0GUaDIIvSMRc These are my comments after I pulled stats myself for all of St Joseph County and not just the city of South Bend. Doing some statistics on evictions in St Joe County. There are 17,000 rentals. Since the moratorium ended there have been 175 evictions filed in August and 55 filed in September. That was out of 521 cases filed in August and 78 filed in September. Of the 521 cases filed in August 106 cases were filed by the City of Mishawaka, which included Mishawaka Utilities and Mishawaka City Schools. If there was going to be a tsumani of evictions it would have already happened. If 42% of tenants are at risk of losing there homes, there would have been 7,140 evictions filed. As of now there is .00088% of the 17000 tenants being evicted in St Joe County. Plus when you take into consideration the rental assistance. It is all a matter of following the money. U.S. Department of Housing and Urban Development (HUD) Secretary Ben Carson Friday, September 11, 2020, announced the allocation of the remaining $1.988 billion in CARES Act funding for the Community Development Block Grant (CDBG) program. The allocation focuses funds towards places with households facing higher risk of eviction. To date, HUD has provided nearly $5 billion in CDBG funding nationwide to help communities combat the coronavirus and alleviate economic hardship. These funds can be used to provide temporary financial assistance to meet rental obligations for up to 6 months, according to HUD's news release. The funds are focused toward places with households facing higher risk of eviction. Specifically: Communities with high rates of businesses in industries with high job loss in states with high unemployment; and Concentrations of those most at risk for transmission and risk of eviction, with higher amounts for states with high rates of coronavirus. Plus as of last stats from Indianapolis, only 8 of the 40 million alloted for rental assistance has been used. Being that this money is being allotted through the Community Block Programs, there is no guarantee the money will go to tenants. Someone in your area has to follow the money.
    John Murray from Portland, Oregon
    Replied 4 days ago
    Good point Colin! There are many repayment options. The key word is repayment and not forgiven debt. The individual must negotiate the best deal possible for repayment. If the owner truly has a vacancy or a non paying tenant forbearance could be a great option. The IRS has great benefits for us landlords, passive loss and the carry over to the next tax year(s). When a greedy owner goes into forbearance to profit from the current financial situation the tax liability goes up and passive loss is reduced. When the forbearance ends agreed terms must be met, another option is loan modification. This is all not a great plan for wealth building by increasing tax liability and decreasing asset value. It is short sighted and just plain ignorant.