The Mortgage Forbearance Program Ended But What Does It Mean for Landlords

The Mortgage Forbearance Program Ended But What Does It Mean for Landlords

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With Omicron finally peaking, more mask mandates at their ends, and not to mention people’s wits, many are finally starting to ask: what about the forbearance programs? The mortgage forbearance program provided so much relief during the pandemic and many landlords relied on it while tenants couldn’t pay their rent. However, many tenants still cannot pay their rent. If the program ends before those same tenants find sturdy employment, so begs the question: what happens next?

All About Forbearance

With Omicron finally peaking, more mask mandates at their ends, and not to mention people’s wits, many are finally starting to ask: what about the forbearance programs? The mortgage forbearance program provided so much relief during the pandemic and many landlords relied on it while tenants couldn’t pay their rent. However, many tenants still cannot pay their rent. If the program ends before those same tenants find sturdy employment, so begs the question: what happens next?

All About Forbearance

According to DS News, anywhere between 3.8 to 4.2 million homes were in forbearance last year, with the program expiring this year. Forbearance was the major step in helping COVID-affected homeowners avoid foreclosure during the pandemic, and with it out of the way, many still need help. According to Forbes Advisor, 151,153 people filed for foreclosures in 2021 and the number was higher in 2020.

 

According to DS News, anywhere between 3.8 to 4.2 million homes were in forbearance last year, with the program expiring this year. Forbearance was the major step in helping COVID-affected homeowners avoid foreclosure during the pandemic, and with it out of the way, many still need help. According to Forbes Advisor, 151,153 people filed for foreclosures in 2021 and the number was higher in 2020.

Landlords around the country know this is pretty rough. Despite a recent spike, there was sharp decline and no real improvement of employment rate during the pandemic. Thanks to the Great Resignation with workers citing not enough pay and the rising cost of living ( COLA and social security benefits rose 5.9% while consumer price index rose 7%), landlords have a great reason to fear that tenants will still be unable to pay their rents. While the forbearance helped keep those landlords safe with everyone unwillingly out of work during the “unprecedented” times, we’re now years in. It’s precedented. So, what’s next?

Landlords around the country know this is pretty rough. Despite a recent spike, there was sharp decline and no real improvement of employment rate during the pandemic. Thanks to the Great Resignation with workers citing not enough pay and the rising cost of living ( COLA and social security benefits rose 5.9% while consumer price index rose 7%), landlords have a great reason to fear that tenants will still be unable to pay their rents. While the forbearance helped keep those landlords safe with everyone unwillingly out of work during the “unprecedented” times, we’re now years in. It’s precedented. So, what’s next?

The Loan Is Up

Here comes the hard part. If your tenants still haven’t gotten jobs and seem to have no good alternatives to start paying their rents, you’re going to have a hard time coming up with ways to start climbing up out of the red. After your forbearance is over, you have to repay what you missed on your mortgage bills. As forbearance isn’t forgiveness, landlords still owe all interest and the principal loan that they initially took out. They do have to pay it back.

This might lead to the urge to give up and just sell the rental home, but we promise it isn’t the only option that you have left on your hands.

The Loan Is Up

Here comes the hard part. If your tenants still haven’t gotten jobs and seem to have no good alternatives to start paying their rents, you’re going to have a hard time coming up with ways to start climbing up out of the red. After your forbearance is over, you have to repay what you missed on your mortgage bills. As forbearance isn’t forgiveness, landlords still owe all interest and the principal loan that they initially took out. They do have to pay it back.

This might lead to the urge to give up and just sell the rental home, but we promise it isn’t the only option that you have left on your hands.

The Mortgage Relief Program: This could reduce your payment up to 25% with the aim to reduce foreclosures. There are three different government issued loan routes this could go, including FHA loans, VA loans, and USDA loans.  

The Modified Mortgage: The new forty-year mortgage seems painfully long but as of fifteen months ago has lowered the monthly cost of mortgages.

Call your bank: If none of these options sound good to you, that’s fine! You can call your official at the bank your mortgage is through, and see what options are available to you through them.

While the end of the COVID Mortgage Forbearance Program may seem like a grim time, it doesn’t mean the end is nigh. There are options you can take besides throwing your hands up and throwing in the towel. Becoming a landlord in the first place shows a lot of perseverance. You stepped into the fray of a job that doesn’t have a great reputation, but you didn’t let that stop you. This shouldn’t either. Time and time again the rental housing industry has shook under our feet but that’s never stopped you before, so this won’t either. This? This is just fine.

The Mortgage Relief Program: This could reduce your payment up to 25% with the aim to reduce foreclosures. There are three different government issued loan routes this could go, including FHA loans, VA loans, and USDA loans.  

The Modified Mortgage: The new forty-year mortgage seems painfully long but as of fifteen months ago has lowered the monthly cost of mortgages.

Call your bank: If none of these options sound good to you, that’s fine! You can call your official at the bank your mortgage is through, and see what options are available to you through them.

While the end of the COVID Mortgage Forbearance Program may seem like a grim time, it doesn’t mean the end is nigh. There are options you can take besides throwing your hands up and throwing in the towel. Becoming a landlord in the first place shows a lot of perseverance. You stepped into the fray of a job that doesn’t have a great reputation, but you didn’t let that stop you. This shouldn’t either. Time and time again the rental housing industry has shook under our feet but that’s never stopped you before, so this won’t either. This? This is just fine.

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Tenant Screening

New California Tenant Screening Bill Was Just Passed into Law – Here’s What It Means for Landlords and Renters

A new year comes with a multitude of new things, and the rental housing industry is no exception. With the passing of California’s Assembly Bill No. 2559, effective January 1st, 2023, an existing consumer report ordered on a prospective tenant by the landlord whose property they’re applying to rent can now be redefined as a reusable tenant screening report. So, what exactly does this mean?
Simply put, an applicant’s report can be reused for the application process within 30 days of purchasing. The furnished report must comply with all state and federal laws pertaining to the use and disclosure of information used in the tenant screening process and must include all specified information as outlined, including, but not limited to: full legal name, verification of employment/income, previous addresses and last known address, the results of a housing record history check (consistent to applicable law), any records that may exist of the applicant’s criminal history, etc.
The benefits of reusable tenant screening reports are not one-sided.
• First and foremost, the acceptance of a reusable tenant screening report by the landlord is entirely optional, and the landlord must be opted in if proceeding with a reusable tenant screening report. Opting in is not a requirement for the tenant screening process.
• Use of a reusable tenant screening report expedites the tenant screening and application process if the applicant is applying to multiple properties and mitigates the expense of the tenant paying multiple fees per property applied for.
• While the initial cost of obtaining the report from a consumer reporting agency is at the request and expense of the applicant, the option for reuse comes at no additional cost to the landlord or applicant, and the landlord is prohibited from charging an application fee to access or view the report.
• The 30-day reuse period allows for the most up-to-date and current information on the applicant if the timeframe is exceeded while the applicant is still applying to properties. This also gives agency and incentive to the applicant to complete the process in a timely manner.
• Reusable tenant screening reports must still contain all prescribed information required for the application, the same as any consumer report ordered for the purposes of renting a property.
• For convenience, reusable tenant screening reports can be ordered and provided through third-party screening providers such as ApplyConnect, which regularly engages in the business of providing a reusable tenant screening report. Doing so will also include propriety parameters each third-party provider includes in their screening process; for instance, shared reports you receive from ApplyConnect will also include ApplyConnect’s SAFE Screen review customized to your address.

While the list of pros is substantial, existing landlords considering proceeding with reusable tenant screening reports may be wondering – “Are there any cons I should be aware of before opting in and accepting a report this way? And what should I be prepared for?”
Like any bill newly signed into law, any inadvertent effects of AB 2559 remain to be seen. For instance, one could ascertain that a byproduct of prohibiting the charge of additional fees by a landlord who traditionally imposes an application/processing fee to cover any additional expenses other than the cost of obtaining the report means forfeiting the landlord’s autonomy to impose such a fee, and that additional cash flow as well. Landlords who opt in will need to amend their screening process to remove said fees.
Section F of the bill also asserts that if an ordinance, resolution, regulation, administrative action, initiative, or other policy adopted by a city, county, or city and county conflicts with this section, the policy that provides greater protections to applicants shall apply. In some cities and counties, these local laws can prohibit rental owners from considering their applicant’s criminal report, even if it’s on a reusable report. Landlords will also have to accept different formats of the report, as not all screening companies were created the same – one might source their data differently than another with different accuracy rates, primarily use FICO instead of VantageScore in credit reporting and vice versa, etc.
As more landlords and property managers accept reusable tenant screening reports, we’ll be able to see more definitively how and if that changes the leasing process in California. While the provisions in AB 2559 are optional now, it’s important to keep your eyes peeled for legislation that could aim to make it required.

Read More »
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Can Your Tenant Legally Own An Alligator As An Emotional Support Animal?

When you think of an emotional support animal, what comes to mind? It would be fair to assume the first thought to enter one’s head would be a dog, if not some kind of bipedal mammal — and most likely not a reptilian carnivore with razor-sharp teeth.

In enters WallyGator: a five-and-a-half foot, 70-pound TikTok famous alligator with over 72,600 followers on the platform owned by Philadelphia, Pennsylvania native Joie Henney. While it is legal to own alligators in Philadelphia, that isn’t the case in many other states — nor is it likely that the majority of pet gators, if any, qualify as emotional support animals. Or is it?

Since Wally’s uptick in popularity on the internet back in August, “alligators” as a related topic to the Google search query “emotional support animal” has seen a 300% increase in search frequency, most likely for the purposes of curious internet users seeing and reading about WallyGator for themselves. However, with the increase in popularity of keeping various species of reptiles as house pets and the common need for emotional support animals, it isn’t beyond the realm of possibility that people with legitimate mental health conditions, unique cases of PTSD, or related conditions could be looking into obtaining a support gator of their own.

As we’ve previously covered, the Department of Housing and Urban Development (HUD) has provided guidance on how the Fair Housing Act (FHA) interfaces with the ADA (Americans with Disabilities Act) regarding emotional support animals. HUD classifies assistance animals into two different categories in order to distinguish their roles from one another: service animals (primarily dogs), and other trained animals that do work, perform tasks, and/or provide therapeutic emotional support for individuals with disabilities. Per HUD’s guidelines, because Wally is not a dog, he, therefore, cannot qualify as a service animal – so, how does HUD define Wally and his role, exactly?

HUD states if the service animal status is not readily apparent, to limit inquiries to two questions: “Is the animal required because of a disability?” and “What work or task has the animal been trained to perform?”, and if the answer to either question is no, then following denial of service animal status under federal, HUD states that the animal can still qualify as a support animal or other assistance animal, depending on what needs to be accommodated.

In Wally’s case, Henney received approval to use him as a support animal after expressing to his doctor he did not want to be medicated for depression following the deaths of several family members and close friends in a short period of time, and more recently, his untimely cancer diagnosis. Even before rescuing and adopting Wally, Henney has worked with and rescued reptiles (particularly alligators) for over thirty years, and his vocation is one he is very passionate about – so it stands to reason his support animal of choice would be one he’s so accustomed to working with.

Because the ADA makes the same distinction that an emotional support animal would only be classified as such due to its mere presence providing comfort as opposed to employing any training to respond to a situation, HUD’s guidelines technically, but clearly grant Wally his status as a legitimate emotional support animal under federal law.

While Wally’s status is protected in the eyes of the law, HUD also states that a housing provider can refuse a reasonable accommodation request for a support or assistance animal if said animal poses a direct threat to the health or safety of other individuals or would result in substantial physical damage to the property of other which cannot be reduced or eliminated. However, before denying such a request due to a lack of information, a housing provider is encouraged to engage in a “good-faith” conversation with the owner of the support animal to gather information about the animal and mitigate any potential misunderstandings regarding its purpose.

Luckily for most property owners, WallyGator is very much an anomaly, and most folks aren’t scrambling to obtain an emotional support gator of their very own, anyway. Henney himself calls Wally a “very special gator” (he’s trained Wally to understand commands and to keep his mouth closed around other people) and actively discourages others to adopt a pet alligator if they’re not actively predisposed to working with alligators, stating “if you don’t know what you’re doing, you will get bit”.

Check out ApplyConnect’s HUD guidance breakdown: https://www.applyconnect.com/wp-content/uploads/2020/02/Emotional-support-animals_-HUDs-Guidance-cliff-notes-AC-Version.pdf

Read More »

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Tenant Screening

New California Tenant Screening Bill Was Just Passed into Law – Here’s What It Means for Landlords and Renters

A new year comes with a multitude of new things, and the rental housing industry is no exception. With the passing of California’s Assembly Bill No. 2559, effective January 1st, 2023, an existing consumer report ordered on a prospective tenant by the landlord whose property they’re applying to rent can now be redefined as a reusable tenant screening report. So, what exactly does this mean?
Simply put, an applicant’s report can be reused for the application process within 30 days of purchasing. The furnished report must comply with all state and federal laws pertaining to the use and disclosure of information used in the tenant screening process and must include all specified information as outlined, including, but not limited to: full legal name, verification of employment/income, previous addresses and last known address, the results of a housing record history check (consistent to applicable law), any records that may exist of the applicant’s criminal history, etc.
The benefits of reusable tenant screening reports are not one-sided.
• First and foremost, the acceptance of a reusable tenant screening report by the landlord is entirely optional, and the landlord must be opted in if proceeding with a reusable tenant screening report. Opting in is not a requirement for the tenant screening process.
• Use of a reusable tenant screening report expedites the tenant screening and application process if the applicant is applying to multiple properties and mitigates the expense of the tenant paying multiple fees per property applied for.
• While the initial cost of obtaining the report from a consumer reporting agency is at the request and expense of the applicant, the option for reuse comes at no additional cost to the landlord or applicant, and the landlord is prohibited from charging an application fee to access or view the report.
• The 30-day reuse period allows for the most up-to-date and current information on the applicant if the timeframe is exceeded while the applicant is still applying to properties. This also gives agency and incentive to the applicant to complete the process in a timely manner.
• Reusable tenant screening reports must still contain all prescribed information required for the application, the same as any consumer report ordered for the purposes of renting a property.
• For convenience, reusable tenant screening reports can be ordered and provided through third-party screening providers such as ApplyConnect, which regularly engages in the business of providing a reusable tenant screening report. Doing so will also include propriety parameters each third-party provider includes in their screening process; for instance, shared reports you receive from ApplyConnect will also include ApplyConnect’s SAFE Screen review customized to your address.

While the list of pros is substantial, existing landlords considering proceeding with reusable tenant screening reports may be wondering – “Are there any cons I should be aware of before opting in and accepting a report this way? And what should I be prepared for?”
Like any bill newly signed into law, any inadvertent effects of AB 2559 remain to be seen. For instance, one could ascertain that a byproduct of prohibiting the charge of additional fees by a landlord who traditionally imposes an application/processing fee to cover any additional expenses other than the cost of obtaining the report means forfeiting the landlord’s autonomy to impose such a fee, and that additional cash flow as well. Landlords who opt in will need to amend their screening process to remove said fees.
Section F of the bill also asserts that if an ordinance, resolution, regulation, administrative action, initiative, or other policy adopted by a city, county, or city and county conflicts with this section, the policy that provides greater protections to applicants shall apply. In some cities and counties, these local laws can prohibit rental owners from considering their applicant’s criminal report, even if it’s on a reusable report. Landlords will also have to accept different formats of the report, as not all screening companies were created the same – one might source their data differently than another with different accuracy rates, primarily use FICO instead of VantageScore in credit reporting and vice versa, etc.
As more landlords and property managers accept reusable tenant screening reports, we’ll be able to see more definitively how and if that changes the leasing process in California. While the provisions in AB 2559 are optional now, it’s important to keep your eyes peeled for legislation that could aim to make it required.

Read More »
Tenant Screening

Can Your Tenant Legally Own An Alligator As An Emotional Support Animal?

When you think of an emotional support animal, what comes to mind? It would be fair to assume the first thought to enter one’s head would be a dog, if not some kind of bipedal mammal — and most likely not a reptilian carnivore with razor-sharp teeth.

In enters WallyGator: a five-and-a-half foot, 70-pound TikTok famous alligator with over 72,600 followers on the platform owned by Philadelphia, Pennsylvania native Joie Henney. While it is legal to own alligators in Philadelphia, that isn’t the case in many other states — nor is it likely that the majority of pet gators, if any, qualify as emotional support animals. Or is it?

Since Wally’s uptick in popularity on the internet back in August, “alligators” as a related topic to the Google search query “emotional support animal” has seen a 300% increase in search frequency, most likely for the purposes of curious internet users seeing and reading about WallyGator for themselves. However, with the increase in popularity of keeping various species of reptiles as house pets and the common need for emotional support animals, it isn’t beyond the realm of possibility that people with legitimate mental health conditions, unique cases of PTSD, or related conditions could be looking into obtaining a support gator of their own.

As we’ve previously covered, the Department of Housing and Urban Development (HUD) has provided guidance on how the Fair Housing Act (FHA) interfaces with the ADA (Americans with Disabilities Act) regarding emotional support animals. HUD classifies assistance animals into two different categories in order to distinguish their roles from one another: service animals (primarily dogs), and other trained animals that do work, perform tasks, and/or provide therapeutic emotional support for individuals with disabilities. Per HUD’s guidelines, because Wally is not a dog, he, therefore, cannot qualify as a service animal – so, how does HUD define Wally and his role, exactly?

HUD states if the service animal status is not readily apparent, to limit inquiries to two questions: “Is the animal required because of a disability?” and “What work or task has the animal been trained to perform?”, and if the answer to either question is no, then following denial of service animal status under federal, HUD states that the animal can still qualify as a support animal or other assistance animal, depending on what needs to be accommodated.

In Wally’s case, Henney received approval to use him as a support animal after expressing to his doctor he did not want to be medicated for depression following the deaths of several family members and close friends in a short period of time, and more recently, his untimely cancer diagnosis. Even before rescuing and adopting Wally, Henney has worked with and rescued reptiles (particularly alligators) for over thirty years, and his vocation is one he is very passionate about – so it stands to reason his support animal of choice would be one he’s so accustomed to working with.

Because the ADA makes the same distinction that an emotional support animal would only be classified as such due to its mere presence providing comfort as opposed to employing any training to respond to a situation, HUD’s guidelines technically, but clearly grant Wally his status as a legitimate emotional support animal under federal law.

While Wally’s status is protected in the eyes of the law, HUD also states that a housing provider can refuse a reasonable accommodation request for a support or assistance animal if said animal poses a direct threat to the health or safety of other individuals or would result in substantial physical damage to the property of other which cannot be reduced or eliminated. However, before denying such a request due to a lack of information, a housing provider is encouraged to engage in a “good-faith” conversation with the owner of the support animal to gather information about the animal and mitigate any potential misunderstandings regarding its purpose.

Luckily for most property owners, WallyGator is very much an anomaly, and most folks aren’t scrambling to obtain an emotional support gator of their very own, anyway. Henney himself calls Wally a “very special gator” (he’s trained Wally to understand commands and to keep his mouth closed around other people) and actively discourages others to adopt a pet alligator if they’re not actively predisposed to working with alligators, stating “if you don’t know what you’re doing, you will get bit”.

Check out ApplyConnect’s HUD guidance breakdown: https://www.applyconnect.com/wp-content/uploads/2020/02/Emotional-support-animals_-HUDs-Guidance-cliff-notes-AC-Version.pdf

Read More »

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Get Started with ApplyConnect!

The nation’s most trusted tenant screening for real estate agents, landlords, and property managers. No cost background checks available 24/7.

©2018 ApplyConnect. All rights reserved

ApplyConnect marks used herein are trademarks or registered trademarks of applyconnect.com. Other product and company names mentioned herein are the property of their respective owners.