A report from Danielle DiMartino Booth at Bloomberg. "The Covid-19 pandemic has unleashed numerous unexpected economic consequences. One that has turned out to be good for the economy but could end up being disastrous is the boom in mortgage refinancings. Just like with the last financial crisis, there are signs that the surge in U.S. consumers seeking to take advantage of ever lower borrowing costs are being aided by relaxed lending standards."

"The Mortgage Bankers Association's refinancing index soared in March to its highest level since 2012, and remains more than 40% above its level this time a year ago despite about 13 million Americans being out of work and relying on weekly unemployment jobless benefits from the government."

"All this activity is being aided by a relatively new innovation called the automated appraisal waiver from Fannie Mae and Freddie Mac. As the name suggests, the waiver means a homeowner who meets certain requirements does not need to obtain an appraisal in order to take out a new mortgage. The result has been nothing short of breathless. The two firms account for an estimated 80% of all conventional refinancings and 90% of all 'cash out' refinancings, according to data compiled by the American Enterprise Institute, or AEI."

"The jump in cash out refinancings represents a 66% increase in the space of seven months thanks in part to automated underwriting. Readers may recall that in the years leading up to the last housing bust, Fannie Mae and Freddie Mac automated income documentation. While that sped up the loan process, which seemed essential at the time given the magnitude of application volumes, it also proved to be a system that could be gamed. There were no safeguards against submitting multiple applications until the income provided finally qualified in the automated system. In the end, 'no documentation' often suited best. We know how that ended."

"Appraisal waivers have been key in supercharging the latest refinancing activity, according to Edward Pinto, the director of the AEI's Housing Center and who was Fannie Mae's chief credit officer in the 1980s. He conceived one of the first automated pricing models in the early 1990’s."

"Here's what he says: 'I’m a big fan of automation,' Pinto said in a recent conversation. 'But the one I designed was for a bank, which retained the risk of the mortgage. With Fannie and Freddie, it’s the taxpayer who assumes the risk, so their only incentive is to push volumes and share as high as possible. We saw how dangerous this was with the GSEs’ automated underwriting systems in the ’00 years. My fear is that appraisal waivers will repeat the same pro-cyclical mistake.'"

"The average equity extraction on a cash out refinancing these days exceeds $60,000, and more homeowners will be enticed to extract equity with every uptick in home prices. The latest data from Redfin shows median home prices have reached record highs and are up 13% over the last year. That helped propel aggregate cash withdrawal volumes to about $100 billion in the past six months based on AEI calculations. And even with refinancing volumes up more than 200% over the same period in the last year, the mortgage analytics firm Black Knight figures nearly 20 million homeowners are still eligible to refinance their mortgages."

From Realtor.com. "Millions of U.S. homeowners are behind on their mortgage payments and struggling to hang on to their abodes. First-time, minority, and lower-income homeowners are among those most at risk of losing their homes. About 17.4% of the roughly 8 million Federal Housing Administration mortgages, primarily made to these more vulnerable borrowers, were delinquent in August. Roughly 11.2% of FHA loans were seriously delinquent."

"Put another way, that means about 1.4 million households are in danger of losing their homes if they can't begin making their mortgage payments again in the near future. FHA loans cater to borrowers who often have lower credit scores and higher debt loads. These loans, whose required down payments are as low as 3.5% in many instances, made up about 15% of all mortgages in 2019."

"In the Atlanta metro, more than 53,000 FHA loans are delinquent. (Metros include the main city and surrounding towns, suburbs, and smaller urban areas.) FHA loans make up about 21.2% of all mortgages in the Atlanta area. The Houston metropolitan area had the second-highest number of delinquent FHA loans. It was followed by Chicago; Washington, DC; Dallas; Riverside, CA; Baltimore; San Antonio, TX; Orlando, FL; and Tampa, FL."

"If there is another rash of foreclosures in a particular neighborhood, it can spiral quickly, lowering property values for homeowners who never missed a payment."

From the Houston Chronicle in Texas. "More than 1 million homeowners are at least 30 days behind on their mortgage payments despite aid from the CARES Act, a sign that the law meant to ease financial stress and ward off foreclosures has let many fall through the cracks, data from Black Knight shows. Misconceptions, a lack of awareness and, in Houston, bad experiences with mortgage relief programs in the aftermath of Hurricane Harvey have led to the pitfall, say housing counselors."

"The majority of the homeowners who have fallen behind on their mortgage payments likely fall into that category — 680,000, or 62 percent, are federally backed, according to Black Knight. 'So many families, after Hurricane Harvey, fell victim to some practices where they were not aware (that) at the end of the deferral period, all of those dollars became due,' said Kathy Payton, chief executive of Fifth Ward Community Redevelopment, which offers free housing counseling. 'So some families are distrustful of the lending environment. They think it’s set up for failure.'"

From WCNC in North Carolina. "'We’ve never seen a housing market so emotional,' said David Hoffman of the David Hoffman Group. Hoffman just launched his own real estate brokerage in the Marvin area. The big question is, are we in an odd bubble? When COVID-19 breaks, will the bubble burst and reality set in? A sellers’ market can quickly turn the other way. 'If you are going to sell in the next five years, think about selling now, protect that equity because I think in the next two years, we might have a pretty large fall. Data tells me prices have more than doubled in the last 10 years, both the median and the mean, and they have outpaced wages and salaries, so I expect a fall,' said Hoffman."

The Daily Republic in California. "Q: My husband and I read your column every week. Now we need help. We have four young children at home. My husband is the sole provider and is the manager of an upscale restaurant in Napa. When the novel coronavirus pandemic and the lockdown happened in March the restaurant closed and he, along with everyone else, was laid off. So he hasn’t worked for seven months. When the unemployment checks included the extra $600 per week we were doing OK. But now, putting food on the table and paying our electric bill is about the best we can do. As a result, our house is going into foreclosure. We desperately want to save our home. With no income, save for unemployment, we don’t even know who would rent to us. Are there any programs out there to either help us save our home or at least help get us into another house?"

"A: When you said you 'need help' and then explained you had four small children, I was sure your email had been misaddressed. But as I read, I saw that your plight is undoubtedly one that I will be hearing more and more as time goes on. Most of the programs that have been put in place by the federal, state and local governments seem to focus on protecting renters. Your average working-class homeowner has been mostly left out of the equation."

"Back in March, Gov. Gavin Newsom reached an agreement with California’s 'major banks' that essentially delayed many foreclosure actions in the state. This was an agreement, not a law. While many banks seem to be continuing to recognize the agreement, they aren’t being compelled to do so. If a government entity wants to come in and just tell a mortgage holder, 'Hi there, Mr. Bank. We have a new law that says you can no longer collect the money that Mrs. Homeowner owes you nor can you foreclose on the property that you thought was security for the loan you made,' there would be a race to the courthouse by every bank in the country."

"Telling a bank they can’t foreclose on their security if they don’t get paid is clearly a taking. So instead, moratoriums are issued. They do a couple of things. First, they broadcast to the public that politicians are looking out for them, and to the banks that the government will not look kindly at the future at your bank if you ignore our moratorium."

"Second, they don’t forgive any amount of money, including fees and interest, that the homeowner owes to the bank. If they did, the government would have to cover your mortgage payment for you. So the government steps lightly, trying to walk a fine line between public perception and the federal courthouse. My advice is that you immediately contact your lender (or lenders if you have more than one mortgage)."

The Orange County Register in California. "Elaine Rock hasn’t raised rents on her tenants for the last seven years. But after California mandated statewide rent control limiting rent increases for certain owner categories earlier this year, she increased rents roughly 5% on each tenant in her El Segundo fourplex. Rock said she felt it was necessary as investors tend to value properties based on income generation."

"On the heels of COVID-19 and subsequent eviction moratoriums, Rock received word that occupants of one unit were struggling financially with job losses. Another tenant was retiring and could no longer afford the rent. In total, three of her four tenants were having issues paying their rent. Assembly Bill 3088, which passed the California Legislature, was signed Aug. 31 by Gov. Gavin Newsom. The bill extends a statewide eviction moratorium to Jan. 31, 2021, requiring tenants to pay at least 25% of their rent Sept. 1 through Jan. 1, and mandating landlords provide tenants a notice of their rights under the temporary law."

"This new bill puts many landlords in a precarious position. It’s estimated some 30% of tenants are not paying their rent, according to a survey by Apartment List. A U.S. Census Bureau survey showed 20% of Southern California tenants reported being behind on rent in August while statewide, 15% said they were late in August. At no time will a landlord be able to kick out the tenant for past due collections (even after the coronavirus crisis ends), so long as the tenant abides by the latest rules."

"Rock requested and received a mortgage payment forbearance from her lender for her fourplex, presumably under the Cares Act, which allows borrowers in good standing to delay thieir payments. Fortunately for Rock, her tenants left or are leaving cooperatively and voluntarily, so she won’t lose income."

"There are 8 million independent U.S. landlords, according to the Urban Institute. How many of them are already at risk of loan default or foreclosure because they are stuck without rent? The U.S. lost 22 million jobs to the pandemic and has recovered nearly half. In California, more than 8.8 workers have filed for unemployment benefits since lockdowns began in mid-March. When it comes to your economic well-being and managing your rental property, hope for a vaccine or cure for COVID-19. But plan for the worst as we just don’t know how long this pandemic and all of its financial and emotional angst is going to last."

"Here are my tips for hard-pressed landlords stuck without rental income: 1) Ask your lender for a mortgage payment forbearance, payment modification, and to add any deferred payments on the back of the mortgage as needed. 2) Refinance property you own to pull cash-out and/or reduce your monthly overhead as mortgage rates are at historic lows. 3) Apply for a private or hard money loan if you get turned down for an institutional mortgage. 4) Borrow money from your stock funds, retirement asset accounts, family or friends in order to temporarily make due. 5) Sell your property; it’s better than potentially losing it to loan default or foreclosure."

"6) File Chapter 13 reorganization bankruptcy to better manage your bills. 7) Sell some goods: Think eBay or any other online sales websites as you might have a treasure-trove of personal or household items that someone else might pay for handsomely. 8) Barter with your tenants for his or her craft or business in exchange for rent."

"Also, Mike Flood, Research Institute of Housing America’s senior vice president, brilliantly suggested landlords can support tenants (and themselves) through various rental assistance programs like HUD Section 8 or block grants. The National Low Income Housing Coalition has an information-rich interactive online map of COVID-19 Emergency Rental Assistance Programs."

From Coeur d'Alene Press in Idaho. "The changing of the seasons offer opportunities to refresh, restart and/or try new things. It might also be an opportunity to save a little money on the real estate market. No matter the time of year, price drops can occur on homes that sit on the market for several weeks. Autumn can add a bit more urgency, especially for sellers who listed in the summer and want the process to end before the end of the calendar year."

"Numerous price drops aren’t necessarily indicative of a slowdown in the market, either. In general, we know the North Idaho market remains strong and that prices continue to steadily climb. That’s all the more reason to consider taking advantage of the occasional outliers."

"This week we’re traveling to Hayden, which is always extremely desirable to many types of buyers. The price-cut-a-palooza in Hayden this week focuses in town with some tempting recent price drops (keeping in mind that some of these may have already attracted a pending offer). We start with two homes west of Highway 95 and just off Hayden Avenue. A three-bedroom, two-bathroom home with just over 1,700 square feet, appealing backyard space and located on a cul-de-sac just slashed $10,000 earlier this month to come in at $339,000. A few blocks west and near Broadmoore Park is a four-bedroom, 2.5-bathroom home with almost 1,700 square feet, and large backyard space priced at $425,000, down $17,000."

"A bit north, just off Miles Avenue is a four-bedroom, two-bathroom home with more than 1,800 square feet and a three-car garage built in 2009 with an especially-appealing patio setup priced at $434,000, down $9,000 earlier this week. Meanwhile, a three-bedroom condo with more than 1,600 square feet near Orchard Avenue offers spacious, low maintenance living for $395,000, a drop of $12,000 from last month."

"East of Finucane Park in Loch Haven Hills are a couple of higher-end homes with recent price cuts. A four-bedroom, 2.5-bathroom home with almost 2,500 square feet, gorgeous landscaping and a spacious deck with hot tub comes in at $629,000, down by $20,000 earlier this week. A four-bedroom, 2.5-bathroom home with 2,100-plus square feet in the same neighborhood offers equally appealing backyard space and updates throughout the home at $569,000, down $29,000 recently. Stay tuned for more price-cut-a-palooza."

The New York Post on Florida. "Legendary real estate marketing guru Louise Sunshine bought a $3 million Miami condo during the height of the pandemic. She also snagged a discount, since the property was most recently on the market for $3.39 million. It was a reprieve for Sunshine. This year, TRD reported, she lost about $2 million selling a duplex penthouse in Miami Beach’s Grand Venetian development that had been on and off the market since 2015."

"'Moving during the coronavirus is the most impossible task I’ve ever undertaken,' Sunshine. She wasn’t planning on buying again, but, as she told TRD, 'it was just bothering me that I could possibly purchase for the same cost per month that I was paying for the rental.'"