Talking about people not being able to pay their rents in this covid meltdown. What happens to the property?

submitted by PencilPusher55 from self.whatever

I know someone that owns a property and hasn't received rent in 6 months. The landlord offered to PAY for them to leave and find them an apartment. From what I know, they are living in the house he owns and squatting. The landlord has done everything he can legally do to dissuade them from remaining on the property. Cutting cable, I believe gas, and whatever legal things he could remove. They will not leave.

The courts are closed and the second they are opened he is filing an eviction notice.

So my question - He hasn't been paid, meaning he's late on the mortgage which then means foreclosure.

Hypothetically - Could these people have actually fucked him out of his investment? Could he actually lose the home to a foreclosure (Say it was not being paid because he didn't get the rent money) if they refuse to leave?

Granted, I do not know if that's the situation because I have not asked and it's none of my business. I was just wondering if these folks could truly have caused him to lose out on his entire investment if the hypothetical I presented above was the case.

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[–]whistlepig 9 insightful - 1 fun9 insightful - 0 fun10 insightful - 1 fun -  (0 children)

The kids on reddit assure me that all landlords are billionaires and only demand rent payments because they are evil bastards, not because they need the money so clearly your story must be made up alt-right propaganda.

.... yea.. I actually had a couple people say this and my comment expressing doubt was heavily down voted.

[–]BeerBaron 5 insightful - 1 fun5 insightful - 0 fun6 insightful - 1 fun -  (1 child)

There are home insurance policies specifically for rental properties and that's where they may be able to find reprieve depending on how good/thorough the policy is- at the same time, it's not usually the best thing when a person utilizes their homeowners insurance policy- just creates nasty marks on records, increases rates, could also decrease coverage so while it may 'save' them, it's certainly not helping them out, ya know? Also, depending on the other assets they own, they may be able to talk the bank into giving them a collateral loan against the house or other assets to pay off the mortgage until they're able to evict the current tenant. Again, not really a great thing, but saves them from being completely boned.

That said, it's completely possible, there are a lot of variables, known unknowns and unknown unknowns. The coming eviction/foreclosure wave is gonna be a wild ride. I expect to see 'Trumpvilles' popping up all over the place.

[–][deleted] 3 insightful - 1 fun3 insightful - 0 fun4 insightful - 1 fun -  (0 children)

Sadly, there was a mass campaign against homelessness and "tramps" by the aforementioned politicians in said article. Since then, and especially since the 1960s, many states and many municipalities have laws explicitly to drive out the homeless. It's far easier to keep shoving them between locations in a competition of "who can punish them the most viciously" than to actually help. This is why states bulldoze their tents and belongings, arrest them (to give them bus tickets to another state), etc.

Unlike in the depression where people might be able to construct shelter from scrapwood, the next round will be absolutely fucked. There will be the haves, and the dead. Thanks to a constant chronic influx of migrant workers taking up all menial jobs, there won't even be seasonal farm work like in the depression. There will be nothing, absolutely nothing, for anybody to fall back on. Every single thing you will find and learn about the great depression, and my grandparents told me much personally as well as books on the subject, as retroactively had the ladder pulled up after it. Everyone will be absolutely fucked.

[–][deleted]  (4 children)

[deleted]

    [–][deleted] 2 insightful - 1 fun2 insightful - 0 fun3 insightful - 1 fun -  (3 children)

    I agree. There are a lot better investment options. One of my favorites are resources that are extremely expensive but easy to re-use.

    [–]KanyeOmega 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (2 children)

    Like what?

    [–][deleted] 2 insightful - 1 fun2 insightful - 0 fun3 insightful - 1 fun -  (1 child)

    https://en.wikipedia.org/wiki/Platinum_group

    [–]KanyeOmega 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (0 children)

    Thanks. Maybe I'm being stupid here, but doesn't the fact that it can be used repeatedly lower it's value? Once I own it, I could use it multiple times, no?

    [–]umad 2 insightful - 1 fun2 insightful - 0 fun3 insightful - 1 fun -  (0 children)

    Hypothetically - Could these people have actually fucked him out of his investment?

    Potentially. This is unprecedented territory right now, so things are going to be up in the air for a while. Many states postponed foreclosures and evictions, so he's probably going to be safe for a little bit as the country is still figuring out how to put the pieces back together. There are some insurance policies that cover this kind of situation. It would be worth him checking his coverage, he might be lucky.

    [–]teelo 2 insightful - 1 fun2 insightful - 0 fun3 insightful - 1 fun -  (1 child)

    Kind of his fault for not planning around what to do with his investment should he not have a tenant for a significant period of time. There are insurance policies for that.

    Fuck property investors, though. They're the reason house prices are so high that most of the working class will be renting for life.

    [–]Comatoast 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (0 children)

    It's not only an issue of property prices. The standards for obtaining a home loan are probably going to get even more shitty and stringent too.. til it's nothing but foreign investors or possibly just government owned.

    [–]Edge_Finder 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (0 children)

    you have to go through the courts, well in US anyways.

    if they are given a notice to evict they can then be forcibly removed. it just cost a lot of thru court etc

    your friend could suspend his mortgage payment, but yeah you still have all the other stuff... he needs to call his bank and everything else

    [–]mongre 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (0 children)

    Could these people have actually fucked him out of his investment?

    I work in the industry so I can chime in. Yes. That's exactly what's about to happen, en masse, across the country. Thousands upon thousands of landlords have gone without rent and are at risk of losing their property. It basically boils down to two categories:

    1. They have a mortgage. Lenders are not going to just ignore a lack of payment. There will be programs to get loans on track, most lenders will be required by law (to be passed) to give borrowers a chance to make up payments. Outside of that, or barring any real protections for lenders, they will start foreclosing. My prediction, along with others, is that there will be an incredibly large number of foreclosures starting toward the end of the year. Large investment firms will be scooping up the deals, no doubt.

    2. They own it. If this is the case, they can eat the lack of rent but very few properties are held this way.

    [–]Comatoast 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (0 children)

    It depends upon the state. There's the federal laws that govern real property, and then each state has laws they adhere to specifically for the purpose of tenant and renter rights.

    Unfortunately, property taxes are going up here. Home owner's insurance, gas, sewer and water are going up as well. If you have a tenant that's paying for utilities in your name this can further complicate everything.

    With many people out of a job and either unable or unwilling to find employment, we've got a collapse on our hands. You guys already know that though. Thinking about it in an interesting light, lenders aren't held by the same rules that mortgagers are. This is a perfect opportunity for the banks to start seizing land and property, and then when they fall prey to mortgagers bankrupting en masse--will also potentially fail themselves. Government would have an excellent opportunity to start condemning those properties and seizing them.