Summer : Is Housing Headed For A Crash Or Boom
Its been a wild ride for the housing market so far this year with tight inventory, sky-high prices and fierce competition. There may not be a crystal ball to look into to predict the future, but weve scoured the landscape to identify the trends that we see shaping the summer ahead.
House Flipping: 5 Things You Need To Know To Create A Successful Career Buying Rehabbing And Selling Properties
In a recent interview with Authority Magazine, New Westerns co-founder, Kurt Carlton, shared advice about what it takes to create a successful career buying, rehabbing and selling properties. He covers everything from common mistakes to avoid to whats most exciting about the real estate industry right now.
Are House Prices Going Up Or Down In California
A rise in Southern California house prices is one of our predictions for 2021, however, theyre not expected to rise as quickly as they have in 2020. For example, home sold prices according to data from CRMLS rose 4.1% year-over-year from 2018 to 2019, however from 2019 to 2020, sold prices rose 14.6% year-over-year! Housing prices are expected to normalize in 2021 as more sellers are encouraged to put their homes on the market and buyers continue to take advantage of historically low rates. According to realtor.coms predictions, home sale prices are expected to go up 5.7% next year.
With home values on the rise, homeowners who are vulnerable to becoming a distressed sale will see their equity positions increase in time. Some will not be able to avoid a foreclosure, but that will cause more of a ripple in the Southern California housing market than a crushing wave.
Bottom Line
While we will see more distressed homes in 2021 once the mortgage forbearance period ends, it will pale in comparison to the Great Recession. This economic recession will not cause declines in real estate values, which means buyers whore hoping to purchase a foreclosure and secure a real estate deal may be disappointed. If you are ready to buy a home now, theres no reason to wait.
How to Buy a Foreclosure in 5 Steps
Step One: Pre-approval
Step Two: Foreclosed Homes Search
Step Three: Submitting Offers
Step Four: Securing Your Investment
Step Five: Ownership
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As Statewide Eviction Moratorium Expires Attorney General Bonta Reminds Homeowners And Renters Of Rights And Protections Under California Law
OAKLAND Following the expiration of the statewide eviction moratorium, California Attorney General Rob Bonta today issued a consumer alert reminding Californias tenants and homeowners of their rights and protections under California law. Attorney General Bonta provides the following information to help Californians understand the protections in place as of October 1, 2021, to help prevent evictions and foreclosures during the pandemic. More information and resources can be found at: . In addition, certain jurisdictions in the state have local laws in place to protect tenants from eviction. Californians should check what rules are in place where they live.
While the statewide eviction moratorium may have ended, the financial impacts of COVID-19 have not, said Attorney General Bonta. Many Californians are still facing financial hardship as a result of the pandemic and may find it difficult to afford their rent and mortgage payments. But even though the eviction moratorium is expiring, there are still protections in place for California renters and homeowners. I urge all Californians to know your rights, and apply for assistance if you think you may be eligible.
Tenants Rights
Effective October 1, the following rules apply to residential tenants and mobile home residents:
Homeowners Rights
Homeowner Bill of Rights
Mortgage Forbearances
When Would Foreclosures Resume
Theres no word on how quickly foreclosures would pick back up after the December 31 deadline passes.
In fact, the CFPB says there may even be situations when it will permit earlier foreclosures if the servicer has made certain efforts to work with the borrower or has been unable to reach them.
Another consideration is the lengthy processing periods that come with foreclosures, which in some states require full-on court proceedings.
According to RealtyTrac, it can take anywhere from a month to over a year to process foreclosures , so depending on where borrowers live, there may still be a chance to get current or modify their loans well after the December 31 marker.
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Paused Mortgage Payments Are Resuming For Many Homeowners Foreclosures And Sales Are Sure To Follow
Several hundred thousand households nationwide will exit forbearance in the coming months without a plan for returning their mortgages to good standing with their lenders.
A federal foreclosure moratorium, which covered about 70% of the nations home loans and about 80% of Philadelphias mortgages, expired July 31. Housing experts anticipate foreclosures will ramp up in the coming months.
The end of the governments moratorium wont result in millions of foreclosures, Rick Sharga, executive vice president of RealtyTrac, a subsidiary of ATTOM, said in a statement, but were likely to see a steady increase in default activity for the balance of the year.
Last month, New Jersey had the third-highest foreclosure rate among the states, according to ATTOM, a real estate data provider. Lenders foreclosed on one in every 4,809 housing units. Nationwide, foreclosures were up 40% in July compared with July 2020 but down 4% from one month earlier.
The situation will probably fall somewhere in between mild and severe, at least in part because lenders may not want to be seen as grim reapers kicking vulnerable families out of their homes, Todd Teta, ATTOMs chief product and technology officer, said in a statement. We will certainly find out over the coming year.
» READ MORE: Why the coming foreclosure crisis will look nothing like the last one
How Do You Apply
You have to do it online, at camortgagerelief.org. If you dont have access to the internet or a computer, you can ask a housing counselor to assist you. For help finding a counselor certified by the federal Department of Housing and Urban Development, call 569-4287. You may also get help from the company servicing your mortgage.
The online application process starts with questions to determine your eligibility. If you meet the states criteria, you can then complete an application for funds. Heres where you will need some paperwork to establish how much you earn and how much you owe.
According to the programs website, among the documents you will need to provide are a mortgage statement, bank statements, utility bills and records that show the income earned by every adult in your household, such as pay stubs, tax returns or a statement of unemployment benefits. Applicants who are not reliant on public assistance or paying more than 40% of their household income to their lenders will also be asked for proof that their lender refused to defer debt or modify their loan to help them avoid foreclosure.
The site provides links to the application in English, Spanish, Chinese, Korean, Vietnamese and Tagalog.
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If You Apply For A Modification The Foreclosure Might Have To Stop
Under California law, if you didn’t previously apply for a modification, or if you’ve had a material change in your financial circumstances since your previous application, and you send the servicer a complete application at least five business days before a scheduled foreclosure sale, the servicer cant proceed with the foreclosure . The foreclosure can only begin after:
- the servicer makes a written determination that youre not eligible for a modification, and the appeal period has expired
- you dont accept a modification offer within 14 days, or
- you accept a modification offer, but you default or otherwise breach the agreement.
But if you’ve already applied and your financial circumstances haven’t changed, submitting an application won’t prevent the foreclosure from going forward.
This California law is more generous than federal law. Federal law requires you to submit your application more than 37 days before the sale to stop the foreclosure.
Information On The Foreclosure Moratorium
The COVID-19 Emergency Eviction and Foreclosure Act of 2020, signed into law on December 28, 2020, places a moratorium on evictions and foreclosures, until May 1, 2021, for people experiencing a hardship related to COVID-19. Effective September 2, 2021, the moratorium was extended to January 15, 2022. During a moratorium evictions and foreclosures may not proceed.
If you already submitted a Hardship Declaration, the moratorium will automatically extend to January 15, 2022. There is nothing you need to do.
The foreclosure moratorium only applies to residential properties for which the owner is an individual who owns ten or fewer dwelling units. Mortgage borrowers should read the complete FAQs below to learn how to get relief for the full moratorium time period.
This FAQ only addresses questions relating to the mortgage foreclosure moratorium. For questions relating to stay of eviction and tax lien foreclosure proceedings, visit the Office of Court Administration website.
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California Courts Suspend Eviction Foreclosure Proceedings Until 90 Days After Coronavirus Emergency Lifted
In a victory for those struggling to stay in their homes, California’s courts suspended eviction and foreclosure proceedings statewide on Monday until 90 days after the coronavirus state of emergency is lifted.
Tenant advocates and some lawmakers praised the decision by the Judicial Council, noting it goes further than last months executive orders by Gov. Gavin Newsom.
Still, they said, it does not eliminate a landlords ability to start an eviction.
Newsoms orders called for a moratorium on evictions but allowed court proceedings to continue and only delayed physical removal until after May. Tenants also must notify their landlord in writing within a week of missing the payment.
Today, the courts took a very major step forward in clearing up a lot of confusion that has existed around what is happening to tenants during this time period, said Asm. David Chiu, D-San Francisco, who chairs the Assembly Housing Committee.
The move halts all court summons, judgements and lock out orders.
Chiu said the decision means people who have lost income due to the COVID-19 crisis wont have to risk their health by having to show up in court right away.
It also gives renters and homeowners facing eviction more time to obtain unemployment and other benefits to stabilize their finances.
Cantil-Sakauye chief justice of the state Supreme Court heads the Judicial Council, which is the policy making body of the California courts.
When To Get Help
Consult a HUD-certified housing counselor if your servicer has filed a notice of foreclosure on your home, but has failed to fulfill any of its responsibilities listed above.
Find a HUD-certified housing counselor today .
The Homeowner Bill of Rights allows you to seek legal action from injuries caused by a violation of the law
You can also report violations to us, the California Attorney Generals Office, or the Consumer Financial Protection Bureau.
- File a complaint with us:
- File a complaint with our friends at the:
- Consumer Financial Protection Bureau:
- Department of Real Estate: dre.ca.gov/consumers/filecomplaint.html
- California Attorney Generals Office:
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Notify You Of Your Options To Avoid Foreclosure
Your mortgage servicer must try to contact you, in person or by phone, at least 30 days before starting the foreclosure process. Your mortgage servicer must do the following:
- Explore options to avoid foreclosure
- Provide you with ways to contact Department of Housing and Urban Development counselors.
Your mortgage servicer should not begin foreclosure action until the above have been performed.
Rights Of Tenants During A Foreclosure
If there are tenants in the house that was foreclosed on, the new owner must honor the existing lease. BUT when the tenants have a month-to-month lease or the owner/landlord also lives in the home that is being foreclosed on, the new owner can evict the tenants or former owner/landlord. In these cases, the new owner may either offer the existing tenants a new lease or rental agreement or begin eviction proceedings. If the new owner chooses to evict existing tenants , the new owner must give the tenants at least 90 days notice before starting eviction proceedings.
- There are other rights that tenants have in eviction cases done after a foreclosure. If a tenant is not named in the complaint for the eviction, he or she may be able to challenge the eviction at any time during the case or even after the judgment for eviction is made. If you are an occupant of a foreclosed property where the new owner filed an eviction case, talk to a lawyer or call the Tenant Foreclosure Hotline at 1-888-495-8020 to learn about your rights.
Tenants in some California cities may still have a right to stay in their buildings. Cities with eviction or rent control laws prohibit new owners from using foreclosure as a reason for evicting tenants.
Help for tenants during a foreclosure
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Attorney General Bonta Reminds Tenants And Homeowners Of Their Rights And Protections Under California Law
OAKLAND California Attorney General Rob Bonta today issued a consumer alert reminding Californias tenants and homeowners of their rights and protections amidst the COVID-19 pandemic. The Attorney General recognizes that families across the state may be facing difficulty affording rent and mortgage payments, including as the result of layoffs, reduced working hours, and other economic impacts of COVID-19. Attorney General Bonta provides the following information to help Californians understand the protections in place that can help prevent evictions and foreclosures during the pandemic.
Housing is a human right. And while we have a long way to go to make available and affordable housing a reliable reality in California, we do have some important protections for those who have been impacted by the financial repercussions of COVID-19, said Attorney General Bonta. Know your rights, and take advantage of the resources that California has made available for you.
Tenants Rights
In response to the COVID-19 pandemic, the State of California has in place its own tenant protections through a law called the COVID-19 Tenant Relief Act. The protections provided under the Act are in addition to protections that have been provided by other federal, state, and local landlord-tenant laws, including the partial eviction moratorium that was issued on August 3, 2021 by the Centers for Disease Control and Prevention .
Single Point Of Contact
When you request a loan modification or other foreclosure-prevention option, your mortgage servicer must promptly establish a single point of contact , which may be an individual or team to assist you with the process.
- The SPOC should guide you through application requirements and deadlines
- The SPOC should provide you with the status of your application
- The SPOC should inform you of missing documents or information needed to complete your application
- The SPOC should have access to personnel with authority to stop or pause foreclosure proceedings, when necessary, during the application evaluation period.
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How Do I Stop My Foreclosure
The only answer that we know that has stopped and continues to stop a foreclosure is by getting a court order, also known as either a temporary restraining order or preliminary injunction . Be aware that just because you were told by someone working for the lender or the servicer of the underlying obligation that the foreclosure is stayed , it does not guarantee they wont foreclose.
For example I had one case where the law firm for Bank of America stated in writing that they will not foreclose on the property. Less than three weeks later the property was sold to a third party. Obviously we used that letter in court, but at the end of the day the clients home was sold and we had to stop the buyer from evicting them from their house.
What Is A Foreclosure
A foreclosure is when the bank initiates to take back a property because the homeowners have stopped making their mortgage payments. Once the borrower has missed three consecutive payments the bank can legally foreclose on the property.
The lender initiates a foreclosure and the bank, not the former owner, sells the home. Typically in California, if the homeowner and lender havent worked out a repayment plan for the outstanding loan to avoid a foreclosure, the lender can record a notice of default in the county at least 30 days after contacting the owner for the foreclosure avoidance assessment. The lender will send a copy of the notice by certified mail within 10 business days of recording. Homeowners can authorize a lawyer, HUD housing counseling agency, or other advisor to communicate with their lender about ways to avoid foreclosure.
At a foreclosure sale you buy in cash, as is. That means you dont get to see the propertys interior. If the plumbing is ruined, the walls are cracked and theres mold, then its your problem. As the new buyer you are responsible for all cosmetic and any legal issues that come with the property.
Benefits of buying a foreclosed home
- Typically faster than a short sale. A short sale is not approved by the bank and may not be even after you make an offer. A foreclosure on the other hand is already in the banks hands.
- Typically cheaper than a short sale. A foreclosure is generally the lowest possible price you will get for a home.
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What Are The Options For Homeowners Currently In Forbearance
The CFPBs foreclosure ban isnt quite in place just yet. So if youre currently in forbearance, youll want to have a plan for exiting particularly if payments are still a challenge.
Your first option is to request a forbearance extension, which would give you another six months break on mortgage payments.
If youre not eligible for an extension or have already used yours, you can:
- Repay your overdue payments in full via a one-time payment
- Arrange a payment plan with your servicer and spread your overdue payments across a three- to 12-month period
- Add the payments to the end of your loan term
- Defer the payments until your home is sold or refinanced
- Modify your loan and change its terms, rate, or other details to make the payment more manageable
Heres a full breakdown of options if youre nearing the end of your forbearance period and still need help.