Being a Small Landlord In The COVID-19 Era

Owning a rental property has been a secure way to grow in the rental-industry and real estate investments. It all was a perfect dream until the pandemic showed up on stage to perform its devastating drama.

On March 11, the WHO declared the coronavirus outbreak as a pandemic. From that time until today, when we are going over the third quarter of 2020. Many industries have suffered the most violent knockdown. During these 8 months, thousands of businesses had closed their doors, with less than a little chance to recover in the near future. 

Due to the unemployment and the Federal and local regulations, here in Portland, Or. Hundreds of small landlords have lost their rental-income and are at risk of losing their properties.

Many Single-family landlords with a federally-backed mortgage have applied for forbearance because their tenants stopped paying rent.

Currently, 6.1 million homeowners have been in COVID-19-related forbearance plans. According to Black Knight statistics, 267,000 loans are in active loss mitigation with their lenders. Just 54,000 loans are past due and not in active loss mitigation.

The good news is, the high level of home equity will help to mitigate foreclosure risk.

Things have turned difficult for small and mom-pop landlords during the COVID-19 era. Nobody knows for sure what is coming in 2021. The moratorium eviction will end by December 31, 2020, but still, isn’t clear if authorities will vote to extend it. Meanwhile, the mortgage obligations will keep accumulating, legal fees, taxes, and property maintenance as well.

Use Your Home Equity To Avoid Foreclosure.

2021 could be the foreclosures year. In April 2021 will end the first 12 months of forbearance. If by that date, the coronavirus crisis has not been resolved, which means returning to normality. The first foreclosure wave will be spreading across the USA. The real estate market will be saturated, and the home prices will drop at least 30% throughout the year.

Landlords that are getting behind in mortgage payments, although they are beneficiaries of a forbearance plan, maybe a risk of losing their rental properties due to the debt accumulation and the difficulties of catching up.

By acting now, you avoid facing a difficult situation in the future. It doesn’t make any sense to keep having headaches because your tenants don’t pay the rent, your lender changes its loan policies without warning, and the government shuts down the country. 

 ATTOM Data Solutions revealed that of the 54.5 million homes with a mortgage, 26.7% of them have at least 50% equity. That number has been increasing over the last eight years. Also, the low-interest rates have raised home prices by about 10% since April 2020.

If as a landlord, things go wrong. If doing your numbers, find out that your situation will be worse in 2021. Consider taking advantage of your home equity.

It doesn’t matter if you have tenants, and your rental house has a forbearance mortgage. You can sell your rental house. You can sell it, as fast as 7 days.

Better Off Home Buyers buys your tenant-occupied rental house. By selling your rental property to us, you kill two birds with one shot. You will get rid of your lender and your tenants at the same time.

In Portland, the real estate market is hot, which is a phenomenon resulting from the actual low-interest rates. However, selling a tenant-occupied rental home that currently has a forbearance mortgage is a task near to impossible. There is not a real estate agent who wants to deal with this kind of business, and most importantly, they don’t know-how. 

It is still a good time to sell your rental income home and get the capital gain from it. The predictions show the real estate market will crash in 2021. Between April to December we will see a dramatic increase in houses for sale, properties abandoned, and a significant drop off in home prices.

Selling your rental home now will prevent you from foreclosure. The foreclosure is a negative stain in someones’ credit report that shuts down financial opportunities in a minimum of 7 years.

Usually, the hardest decisions are the ones we must take. It isn’t easy to detach from dreams and illusions. To build a patrimony for the family is a great endeavor, but sometimes, it is necessary to deal with hard times. No doubt the COVID-19 hardship is the toughest period the world has seen in decades.

If you have decided to sell your property, contact us.

We are Better Off Home Buyers, fill the form on this page, or dial (503) 212-9641. We can help you!

Non-Federal Backed Home Loans.

Landlords and homeowners in general with a non-federal backed mortgage are exposed to a foreclosure if they miss monthly payments. As a coronavirus crisis relief, the CARES Act mainly protects homeowners with federal-backed up home loans. Those homeowners, who don’t fit in this category, are treated in a very different way.

At the Better Off Home Buyers offices, we have received information of homeowners who were forbearance denied by their banks. Others were three months forbearance granted, but at the end of that period, they were not approved by an extension. When they ask their lender officers for an explanation, simply, they were ignored.

Across the nation, there are more than a million non-federal backed mortgage loans. If the economic-epidemic crisis has impacted them. They become fresh meat for hungry depredator-lenders.

For a homeowner or an independent landlord falling behind in payments, we recommend selling the property. Still, it is time we believe that home prices will come down by May or June 2021.

Still, you can capitalize on your home equity. We offer to buy your house in a short time.

Our house purchasing process is fast, typically, we purchase a property in 7 days. 

Unfortunately, there are no guidelines on how banks should manage loan services. They can apply whatever criteria they want to. There are hundreds of stories of how hard-working people have been screwed by lenders.

If you are in a similar situation, do not hesitate to contact us. We can help you with information or by purchasing your property.

The homeowners with a non-backed mortgage are the most vulnerable during this crisis. Cases have been known, where the mortgage forbearance landlords have received a notice of default from their lenders just 4 months after their tenants stopped paying rent.

After The Forbearance Period.

If you took a Coronavirus hardship break and suspended your mortgage payments, contact your lender right before your forbearance plan ends.

Depending on the kind of loan you have, you can request an extension. According to the Better Off Home Buyers research, an extension for a non-federally backed (Private loan) mortgage depends 100% on the lender’s decision. Homeowners with a conventional mortgage have a small chance to be approved for a forbearance extension or a loan modification. 

We believe that in the homeowner’s favor, banks don’t want to have a big house inventory, their business is “money making money,” in fact, for banks, owning houses means losing money.

Many lenders would offer an interest rate higher than the actual rate a homeowner may have. Depending on the program your servicer has, you can change the terms of your loan or not.

If you have a private lender, any forbearance plan available for you will be at your lender’s discretion. If you inform your bank that you continue suffering income loss pandemic related. It may be that your lender does not do anything to help you. 

If a forbearance extension is unavailable to you, then you will be looking at two scenarios. One is your inability to resume monthly mortgage payments, eventually, your lender will foreclosure on you. In the other scenario, if you have a place to go, where according to your income ability, you can afford it. Consider the possibility of selling your house.

Selling Your House In Forbearance.

While you are in a forbearance mortgage plan, you can sell your rental house. Yes, by selling, you can pay off that forbearance, take your home equity, and reinvest in other industries. However, there are a lot of people that may reach the end of their forbearance, and they are not able to continue making payments. 

Forbearance is not forgiveness, just ending a forbearance plan, you must retake payments. Hopefully, you can meet all your obligations but if the crisis is not giving you a chance, we can buy your property.

After the forbearance plan ends, selling the property sounds like a good option. However, hiring a real estate agent will prolong the selling process, and it may put you at a bigger risk of foreclosure by your lender.

Better Off Home Buyers will buy your house. Our process of purchasing homes is easy to understand, clear, and fast. Our clients control the selling transaction time. If you need to sell your house because that is the best option to end your forbearance plan, and because you want to prevent yourself from facing foreclosure. Let us help you.

In our experience, many homeowners got more money in their pockets after selling their houses to us than the amount they would receive by selling through a real estate agent.

Have in mind that selling your house in the regular market takes time. You need to take a lot of money out of your pocket to pay the real estate agent’s commission, the home repairs, legal, and closing fees. 

House Buying Company in Portland

Better Off Home Buyers solve your real estate problems by buying your rental house or your residential home.

Contact us at (503) 212-9641 or fill the form on this page. 

Hablamos Español también.


Hi, I'm Scott Dalinger a real estate investor in Portland, Oregon. I focus on helping homeowners and rental property owners out of negative situations by offering cash for their property. I research and write about real estate on my business website.

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