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David Stanger Explains How COVID-19 is Impacting Rent and Mortgages

11th May 2020 Print

With several U.S. states beginning to relax restrictions put in place due to the global COVID-19 pandemic, we are just beginning to see how the economic slowdown has affected various industries. The crisis is undeniably impacting everyone in some way or another and those looking to rent or buy homes are no exception. 

David Stanger of Lakewood, New Jersey, is the founder and vice president of Westmarq Real Estate Group, a team of dedicated short sale specialists that help homeowners avoid foreclosure and sell their homes quickly. He explains how the COVID-19 pandemic is impacting rent and mortgages. 

Financial Pitfalls and Uncertainty

Understandably, the Coronavirus pandemic has caused a lot of concern for the real estate market in general, simply because many people are not planning on moving, notes David Stanger. In fact, a recent report found that 55% of homeowners who had planned to sell their home over the next 12 months chose not to list their house at all or took their house off the market completely. Potentially even more concerning, at this time, over 33 million Americans have lost their jobs since the onset of the Coronavirus pandemic. As a recession sets in, many homeowners and renters are worried about being able to pay their mortgage or rent, putting them at risk of getting evicted. 

During the last recession, which started in 2008, many Americans lost their homes due to foreclosure, say experts at Westmarq Real Estate Group. In fact, in 2010, it was found that foreclosure filings were reported on one in 47 homes. With so many Americans now being out of work due to the pandemic, with relatively no indication of when conditions will improve, there is uncertainty whether we could see these drastic numbers again. 

Qualifying for a Mortgage

The pandemic may also affect many Americans’ ability to qualify for a mortgage. Many people that were planning on buying a home prior to the pandemic that have lost their jobs could now have more difficulty securing a home. In addition, many people have invested their down payments in the stock market and lost it due to volatility. These aspects put hopeful mortgage holders at a big disadvantage. According to reports, some lenders have increased required credit scores and are issuing less mortgages overall. 

This issue can translate to renters as well. Rental applications may be denied due to unemployment and low credit scores. 

Eviction and Foreclosure Protection

When it comes to protection from eviction and foreclosure, perception is mixed. There are some forms of protection, says David Stanger of Westmarq Real Estate Group, but they don’t apply to everyone. 

If homeowners’ mortgages are backed by the federal government, they are temporarily protected from foreclosure under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Similarly, renters may be exempt from eviction if their landlords’ mortgages are backed by the Federal Housing Administration or if they live in low-income housing that is federally designed. Evictions and foreclosures for these individuals were halted for 60 days in a response to Coronavirus. While this is a step in the right direction, it protects very few people, notes David Stanger. Compared with the roughly 43 million Americans that rent their home, only eight million units are federally backed.

As well, despite these protections, experts note that it is best to continue paying your rent and mortgage as long as you are able, as once these conditions are lifted, any outstanding payments will be owed all at once.  

Final Thoughts from Westmarq Real Estate Group

The pandemic has caused many fears and a high amount of stress for both homeowners and renters. And while there are some actions in place to help protect them, they cannot protect them all. 

David Stanger created Westmarq Real Estate Group during the great recession to protect homeowners from foreclosure and eviction. Their specialists aim to help clients avoid foreclosure, settle their debt, and salvage their credit. Their short sale real estate team will work with your lender to negotiate a reduced payoff amount on your home mortgage so you can get out from under the debt. Helping clients in New Jersey throughout the last recession and beyond, Experts at Westmarq Real Estate Group are there to support their clients through this difficult time.