Monthly Archives: April 2020

Federal PPP Loans Over $2M to Get ‘Full Review’

After large companies and sports teams got Paycheck Protection Loans higher than $2M, the Treasury Sec. said they’d be audited before any loan money was forgiven.

WASHINGTON – Treasury Secretary Steve Mnuchin Tuesday said federal loans exceeding $2 million would get a “full review” after large companies and pro sports teams such as the Los Angeles Lakers took advantage of a stimulus program meant for small businesses.

Mnuchin said it was “inappropriate” for corporations, such as restaurant chains Shake Shack and Ruth’s Chris, and sports franchises, such as the NBA’s Lakers, to apply for and receive Paycheck Protection Program loans created to rescue the cratering economy caused by the coronavirus pandemic.

Florida Realtors is monitoring everything regarding how the COVID-19 pandemic is affecting the real estate industry and Realtors and sharing it here.

“I’m a big fan of the team but I’m not a big fan of the fact that they took a $4.6 million loan,” he said on CNBC of the Lakers, which Forbes has valued at $4.4 billion. “I think that’s outrageous and I’m glad they returned it or they would have had liability.”

Shake Shack, Ruth’s Chris and the Lakers have returned the loans.

The program offers loans of up to $10 million to eligible businesses. The loans are completely forgiven if at least 75% of the money is spent on keeping or rehiring employees. The rest must be spent on business-related expenses such as rent or utilities.

Under the new framework, any PPP loan above $2 million would be audited and reviewed before they are forgiven. Large businesses that already received a loan have until May 7 to return the money or they could face penalties.

Mnuchin called the program “an incredible success.” But his announcement comes as the program continues to face technical issues that have slowed the processing of loans as many small businesses warn they are days away from shuttering forever.

Thousands of small business owners who have waited weeks for federal loans to rescue them during the coronavirus crisis endured more delays Monday as an unprecedented flood of requests continues to overwhelm a system never meant to handle the millions of loan applications PPP has generated.

The combination of an overwhelmed federal computer system and a massive crush of loan submissions led to the delays in the program when it re-opened Monday, officials said.

The PPP, managed by the Small Business Administration, began accepting loan applications April 3 but temporarily ran out of money for several days after it had exhausted the $349 billion Congress approved last month. It began accepting applications again Monday after lawmakers approved another $310 billion for the program last week.

In an effort to avoid the computer crash that plagued the initial opening of PPP this month, SBA notified lenders that a new “pacing mechanism” would prevent them from flooding the E-Tran system, the online portal where loans requests are submitted.

“The pacing mechanism prevents any one lender from submitting thousands of loans an hour into the E-Tran system,” SBA spokeswoman Shannon Giles told USA TODAY. “If a lender goes above the pacing limit they will get timed out.”

American Bankers Association President and CEO Rob Nichols tweeted that lenders are “deeply frustrated” with the delays.

“Until they are resolved, America’s banks will not be able to help more struggling small businesses,” he wrote.

It’s the latest hiccup for the program, the centerpiece of the federal effort to keep as many as 30 million small businesses afloat in the midst of the social distancing measures taken to combat the COVID-19 pandemic.

Technical glitches delayed the first wave of loans earlier this month and the program was heavily criticized for allowing large firms and publicly traded corporations to access large loans while scores of mom-and-pop businesses were shut out.

Compounding the situation Monday was unprecedented volume. The number of users accessing the system is double compared with any day during the initial round of PPP, according to the SBA.

Despite the delays, the agency reported it had processed more than 100,000 loans by some 4,000 lenders as of 3:30 p.m. Monday. The SBA had approved more than 1.6 million loans in the first round.

Under the program, firms employing 500 or fewer workers are eligible for low-interest loans of up to $10 million to cover their costs while they’re shuttered.

The loan, covering eight weeks of operations, does not have to be paid back if at least 75% of the money is spent keeping or rehiring workers. Otherwise, it carries a 1% interest rate and must be paid back within two years.

Copyright 2020, USATODAY.com, USA TODAY

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Fed Likely to Hold Rates Near Zero for Months

The Fed noted the gravity of the COVID-19 pandemic that has gripped the economy and made clear it would continue to do all that it could to provide support.

WASHINGTON (AP) – The Federal Reserve signaled Wednesday that it will keep its key short-term interest rate near zero for the foreseeable future as part of its extraordinary efforts to bolster an economy that is sinking into its worst crisis since the 1930s.

The pandemic-slowed economy pushed the average 30-year mortgage rate to its lowest point in at least 50 years – since Freddie Mac started tracking rates in 1971.

The Fed noted the gravity of the crisis that has gripped the economy in the face of the coronavirus outbreak and made clear it would continue to do all that it could to provide support. But at a news conference, Chairman Jerome Powell cautioned about any prospects for a swift or a robust economic recovery.

“I would say that it may well be the case that the economy will need further support from all of us if the recovery is to be a strong one,” Powell said.

Powell suggested that given the depth of the U.S. economic catastrophe, with perhaps 30 million people having lost jobs in the past six weeks, it will “probably will take some time for us to get back to a more normal level of employment and ultimately maximum employment.”

The chairman and the Fed itself sought to provide reassurance, though, that their aggressive intervention could help mitigate the vast damage to the economy and to millions of workers. In its statement, the Fed said it is “committed to using its full range of tools to support the U.S. economy in this challenging time.”

The viral outbreak and measures to contain it,” the statement noted, are “inducing sharp declines in economic activity and a surge in job losses.”

Under Powell, the Fed is confronting a deeply perilous moment for an economy that had looked robust just a few months ago. Since the virus struck with full force last month, widespread business shutdowns have caused roughly 30 million workers to lose jobs. As layoffs mount, retail sales are sinking, along with manufacturing, construction, home sales and consumer confidence.

At his news conference, the chairman noted that layoffs have struck hardest at the lowest-income American workers, many of whom had just begun to make progress in the 11th year of an economic expansion that has now ended.

“It is heartbreaking to see that is threatened now,” Powell said.

During two emergency meetings in March, the Fed cut its benchmark rate to a range between zero and 0.25%. It has also announced nine new lending programs to pump cash into financial markets and provide support to large and medium-sized businesses as well as cities and states.

In its statement Wednesday, the Fed said it will also keep buying Treasury and mortgage bonds to help keep rates low and ensure that companies can lend easily to each other amid a near-paralysis of the economy caused by the coronavirus. It did not specify any amounts or timing for its bond purchases.

It said it will keep its rate at nearly zero “until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.”

That’s the same language it used in its previous statement last month.

Nor did the Fed provide details about the pace of its purchases of Treasurys and mortgage-backed securities. It has tapered those purchases recently as markets have calmed. But earlier this month, it bought as many Treasury securities in a day as it did during an entire month in the 2008-2009 Great Recession.

In its statement, the Fed also raised concerns about slowing inflation, which is likely to sink further below its 2% target level in the coming months.

“Weaker demand and significantly lower oil prices are holding down consumer price inflation,” the statement said.

The Fed’s statement came on the same day that the Commerce Department released grim news about the economy: Economic output shrank at a 4.8% annual rate in the first three months of the year – the worst showing since the Great Recession struck near the end of 2008.

The economic picture is expected to grow ever darker, with the economy forecast to contract at a shocking 30% to 40% annual rate in the April-June quarter. The unemployment rate could reach 20% when April’s jobs report is released next week.

The central bank has already slashed its benchmark interest rate to near zero and escalated its purchases of Treasury and mortgage-backed securities to pump cash into financial markets to smooth the flow of credit. It has also said it will buy corporate bonds and lend to states and cities – two actions it has never previously taken.

“The fact that they are operating in those markets is unprecedented,” said Nathan Sheets, chief economist at PGIM Fixed Income and a former director of international finance at the Fed. “They are coming up on the extent of their legal authorities here.”

Yet this crisis is unlike any other, and it comes against a backdrop of horrific economic data. More than 26 million Americans have sought unemployment benefits since the viral outbreak shuttered much of the U.S. economy in mid-March.

As economic activity has collapsed, inflation has also begun to fall. Economists expect it to drop below 1% by next year, far under the Fed’s 2% target level. That poses another problem for the Fed: Declining prices can eventually lead consumers to delay spending, thereby slowing the economy further.

Earlier this month, as part of a $2.3 trillion lending program, the Fed said it would buy municipal bonds issued by state and local governments, up to $500 billion. It also unveiled a Main Street Lending Program, which will lend $600 billion to medium-sized companies of up 10,000 employees.

These loans are intended to support mostly companies that are too large for the government’s small business lending program, which targets those with fewer than 500 workers. Companies that borrow from the Main Street program must “make reasonable efforts” to retain their workers, the Fed says, and cannot repurchase their shares or pay dividends. The Fed has said it will disclose the recipients of its Main Street loans.

Still, neither the municipal nor Main Street programs have yet started. The Fed has yet to buy any municipal securities or corporate debt. Even so, just the announcements that it will do so have smoothed markets.

These new programs have exposed the central bank to concerns that it will inevitably favor some companies or municipalities over others. The Fed, whose independence is seen as vital to its role in the financial system, has always steered clear of such potentially politicized actions.

It has come under pressure from Congress to help specific sectors. Sen. Ted Cruz, Republican of Texas, wrote Powell on Friday urging that the Fed set up a lending facility specifically for small and medium-sized companies that work with the beleaguered oil and gas industry.

Doing so, though, would likely spur other industries to ask for similar help.

“Why oil and not hospitality? Or some other sector?” Sheets said.

Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission. AP Economics Writer Martin Crutsinger contributed to this report.

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Florida Vacation Rental Ban to Continue for Now

The virus-related ban on short-term rentals remains in effect until further notice. 

Florida Realtors is monitoring everything regarding how the COVID-19 pandemic is affecting the real estate industry and Realtors and sharing it here.

TALLAHASSEE, Fla. – On Monday, Florida’s restaurants and retail stores will be allowed to reopen, but only at 25% of full capacity and only if a local government allows it, Gov. Ron DeSantis announced at a press conference on Wednesday. It’s the first phase of a three-phase process he named “Safe. Smart. Step-by-Step.”

However, short-term vacation rentals will be banned during Phase 1 of the governor’s drive to reopen the state’s businesses. The ban went into effect on March 27 and has been extended by Executive Orders.

While the governor hopes that Phase 1 will last only a few weeks before the state moves to Phase 2, there is no timeline, and the vacation-rental ban remains in effect. Florida Realtors continues to advocate for the ban to be lifted.

DeSantis says the timing for different phases and steps within the reopening process will be guided by a data-driven approach that assesses positive case rates and hospital capacity.

© 2020 Florida Realtors®

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Mortgage Rates Hit All-Time Low – 3.23%

The pandemic-slowed economy pushed the average 30-year mortgage rate to its lowest point in at least 50 years – since Freddie Mac started tracking rates in 1971.

WASHINGTON – The pandemic-slowed U.S. economy pushed the average 30-year mortgage rate to its lowest point in at least 50 years, according to Freddie Mac, which started tracking rates in 1971.

The size and depth of the secondary mortgage market is helping keep rates at record lows, Freddie Mac says. Today’s low rates are driving higher refinance activity and a modest uptick in demand for new-home purchases.

However, not everyone can take advantage of today’s low rates. In some cases, banks have tightened lending restrictions and are making loans only to well-qualified buyers or home refinancers. In addition, some potential homebuyers in January are now out of work as applications for unemployment skyrocket.

At 3.23%, the average 30-year fixed-rate mortgage is down 0.10% week-to-week (from 3.23%) and 0.91% compared to this same time last year.

The 15-year fixed-rate mortgage dropped to 2.77% this week. That’s down .0.09% from last week (from 2.86%) and down 0.83% year-to-year.

The 5/1 hybrid adjustable-rate mortgage averaged 3.14 % this week.

Economists at Fannie Mae predicted this week that 30-year rates could go as low as 2.9% in 2021, however it’s unclear yet what effect the COVID-19 pandemic will have over the long term.

“In our view, the negative shock will apply to both the home purchase and rental markets. On the demand side, early indications are that the purchasing benefit of lower interest rates are being offset by the downturn in employment,” says Doug Duncan, senior vice president and chief economist at Fannie Mae.

“On the supply side, the number of listings is falling, as those with homes to offer may either be hesitant to allow strangers to tour their home or worry that the lack of demand is placing downward pressure on the sales price they might otherwise receive,” Duncan adds.

© 2020 Florida Realtors®

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Dear Anne: Clear Cooperation? Nothing ‘Clear’ About It

NAR told MLSs to adopt its Clear Cooperation 8.0 policy by May 1, and one Realtor finds it overbearing. Why can’t Realtors advertise a listing before it goes into the MLS? Can a local MLS opt-out if they choose? And why did NAR do this in the first place?

Dear Anne: My MLS is telling everyone that the National Association of Realtors®’ (NAR) Clear Cooperation 8.0 policy went into effect on May 1. I’m not sure why they call it “clear” – it’s as clear as mud to me.

What were they thinking when they came up with this gem of a rule? Can my MLS opt out of this policy? I do not like being told I can’t advertise my listings before they go into the MLS. – Clear as Mud

Dear Clear as Mud: The ink has dried on Clear Cooperation 8.0, and the short answer to your question is “no” – your local MLS cannot opt out of this policy. To quote NAR’s FAQ on Clear Cooperation: “It is mandatory that all Realtor® Association MLSs adopt the policy and have the same consistent standard.”

To explain Clear Cooperation 8.0, I thought I would break it down to help you understand it better:

What is Clear Cooperation 8.0?

The short explanation of Clear Cooperation 8.0: Within one business day of marketing a property to the public, the broker must submit the listing to the MLS. The property must be the subject of an exclusive written listing agreement signed by the sellers. Verbal, net and open listings are not permissible in the MLS, therefore they are not subject to Clear Cooperation 8.0.

NAR’s FAQ says, “The obligations of Statement 8.0 were specifically adopted to address concerns with residential ‘for sale’ exclusive listing contracts required to be filed with the service. Based on the Advisory Board’s discussions that did not include commercial properties, rental properties and new construction developments with multiple properties (single-family homes, condos, etc.) Those property types and other exclusive listings that require mandatory submission can be included in the application of Statement 8.0 at local discretion.”

Note: It’s up to your local MLS to decide if they want to expand 8.0 to include mandatory listings that are not residential.

Factoid: Questions about this one? Call your local MLS first. While Florida Realtors Legal Hotline is well-versed on Clear Cooperation, they cannot weigh in on rules that are specific to your local MLS.

What is ‘public marketing’ under Clear Cooperation?

 NAR says public marketing includes, but is not limited to:

  • Flyers displayed in windows
  • Yard signs
  • Digital marking on public-facing websites, brokerage website displays including IDX/VOW
  • Digital marketing communications such as email blasts
  • Multi-brokerage listing sharing networks

Factoid: Any marketing to the public outside your brokerage – any shape, fashion or form – triggers your obligation under 8.0 to submit your listing to the MLS unless sharing directly with your clients.

Why did NAR create this policy?

I can answer this in three words: Off-Market Listings – or in real estate industry slang, pocket listings. NAR’s rationale to adopt 8.0 is as follows:

For years, Realtors® have debated the risks and merits of so-called pocket listings, “coming soon” listings, and listings that are marketed on private networks rather than being shared cooperatively through a local multiple listing service. Advocates say that sellers’ desire for privacy and advances in technology have led to the expansion of these off-market listings. Others believe that keeping listings from the MLS reduces buyers’ choice, skews market data and may not be in the sellers’ best interests.

Common questions about Clear Cooperation 8.0

Do I get a pass if my seller tells me it is okay to advertise their property before submitting the listing to the MLS?
No, the minute you publicly market the property you have one business day to submit to the MLS – no exceptions.

What about “office exempt” listings?
If you want to market your listing within “the family,” meaning within the listing brokerage, the office-exempt status is for you. To clarify, if your brokerage is affiliated with a franchise, you can only share your listing with those brokers and agents within your independently owned brokerage and not your “extended” family. Your MLS may require you to complete additional documentation for this status. However, once you market outside the confines of your listing brokerage, 8.0 kicks in. For those who subscribe to the cost-of-doing-business approach, remember the cap on fines is $15,000.

What if my listing isn’t ready to show and I want to pre-advertise? Not a problem. Check with your MLS to find out which status is the appropriate one to use: Coming Soon, No Showings, Delayed Showings or Temporarily of the Market, etc. Understand the terminology because the criteria that accompany each status varies from MLS to MLS. If you have questions, your MLS is your best resource on this one.

What if my seller does not want his listing included in the IDX/VOW display? Are we required to do so under Clear Cooperation? No, the seller can opt-out of having the listing on the internet. Clear Cooperation is about sharing listing information with other cooperating brokers and providing your seller the best exposure on the marketplace.

Want to learn more 8.0? NAR offers a plethora of information on its website.

Have an ethics or rules question? Email us at legalnews@floridarealtors.org with “Dear Anne” in the subject line.

Anne Cockayne is Director of Local Association Services for Florida Realtors

© 2020 Florida Realtors®

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FORMS UPDATE: 5 Listing Agreements Changed

All four versions of the Exclusive Right of Sale Listing Agreement (ERS) and the Exclusive Brokerage Listing Agreement (EBLA) have now been updated to reflect NAR’s Clear Cooperation Policy.

Keep up with what’s changed recently to the forms, contracts, and manuals you use for your business.

ORLANDO, Fla. – The National Association of Realtors®’ (NAR) Board of Directors agreed to a mandatory change to all MLSs during the November 2019 NAR Convention. The MLSs had until May 1, 2020, to adopt that change – called MLS Statement 8.0 – but commonly known as the Clear Cooperation Policy.

As a result, all applicable Florida Realtors’ listing agreements have been modified to inform the parties as to the rules’ parameters. Each form will have an updated version number and revision date to reflect these changes. Specifically, the forms that were modified are:

  1. Exclusive Brokerage Listing Agreement
  2. Exclusive Right of Sale Listing Agreement – Transaction Broker
  3. Exclusive Right of Sale Listing Agreement – Consent to Transition to Transaction Broker
  4. Exclusive Right of Sale Listing Agreement – Single Agent
  5. Exclusive Right of Sale Listing Agreement – No Brokerage

For a more in-depth explanation of these changes, please see “8.0 Clear Cooperation Policy Revisions to Florida Realtors’ Listing Agreements.”

Meredith Caruso is Associate General Counsel for Florida Realtors

© 2020 Florida Realtors®

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Listing Conversations: Who has the Tiebreaking Vote?

During the COVID-19 pandemic, people have had expressed varying opinions about what practices are advisable vs. inadvisable. If a property owner and a listing agent have differing opinions, whose opinion has legal priority? Generally, it’s the brokerage company.

ORLANDO, Fla. – As the COVID-19 pandemic unfolded, people have had a wide range of responses. Some chose to implement behaviors that are extremely conservative based on an abundance of caution. Others decided they are comfortable permitting anything not expressly prohibited by official orders or recommendations from governmental authorities.

Please note that this article is limited to judgment call scenarios, as opposed to any action that would disobey an official order or fail to comply with important official guidance from an agency like the Centers for Disease Control and Prevention or Florida Department of Health.

The COVID-19 pandemic is bringing up many legal concerns for people who work in real estate. Here’s a look at the questions we’re getting the most at Florida Realtors and information to help you navigate.

This is a tricky issue to unpack, so let’s start with a strong recommendation. A listing agent and seller should strive to get on the same page when it comes to listing procedures and practices. If they encounter an area they disagree on, such as taking off shoes before entering the property, they should talk about the issue and strive to reach a consensus. Mutually acceptable compromise after clear and compassionate communication is often far better than being “right” at the expense of a strained professional relationship.

There’s also one very important distinction. Single agents and transaction brokers operate under different obligations. A seller will have more control over the actions of their single agent, since their agent owes the following duties that go beyond those of a transaction broker: loyalty, confidentiality, obedience, and full disclosure. Therefore, a single agent is typically required to follow the seller’s instructions based on the obligation of obedience unless there is a specific reason to not obey, such as if the request would require the agent to break the law.

For the meat of the legal analysis, we’ll look to the Exclusive Right of Sale listing agreements prepared by Florida Realtors. The terms described in this brief overview will be the same, regardless of whether parties use the listing agreement for a single agent, transaction broker, consent to transition to transaction broker, or even a no brokerage relationship listing agreement.

When reading contracts, it’s always important to distinguish obligations from permissions. An obligation will use words like must, will, or shall. A permission clause will use words like may, is authorized to, or can.

Obligation

Section 4 of the listing agreements are titled Broker Obligations, and it provides that “Broker agrees to make diligent and continued efforts to sell the Property in accordance with this Agreement until a sales contract is pending on the Property.” It’s important to note that, although it is an obligation, there is significant room for discretion. What do “diligent and continued efforts” look like? This clause gives the brokerage company a good amount of leeway to set policies and procedures that it deems most effective. Also note that there is an end date to the obligation portion of the listing agreement since the obligation lasts “until a sales contract is pending on the Property.”

Permission

There is also a permission-based section in Section 6 of the contract titled Broker Authority. Note that the framework for the whole section begins “Seller authorizes the broker to…” which is followed by a list of actions the broker has permission to do. This means that the seller has relinquished control of these decisions to the broker, so the broker can use discretion in how, when, or if to take these steps, provided they continue to use diligent and continued efforts to sell the property. It includes permission to do such things as market the property to the public, get information about any mortgages on the property, and provide comparative market analysis to potential buyers. It also contains a few opt-in or opt-out clauses with checkboxes, including potential restrictions on marketing to the public, using a lock box system, withholding verbal offers, withholding offers after a seller accepts a sales contract, and limiting the information provided to virtual office websites.

Here’s a final recommendation rooted in general liability. If a seller wants to take a more conservative approach than you would like, it’s often best to follow their lead, even if you disagree. For example, let’s say a seller fears that they may be more susceptible to COVID-19 than most and wants to strongly limit showings. If you flex the power the listing agreement gives you to override seller’s concerns, you could potentially be liable. In this example, if the seller becomes sick as a result of in-person showings you demanded, they could look to you and your brokerage company to compensate them for any harm they suffer.

In conclusion, the listing agreement gives the brokerage company a large amount of discretion in how to market the owner’s property. However, it pays to be thoughtful when exercising that power. When parties can’t compromise, and when someone is not a single agent, they should be mindful of liability and other specific factors before exercising the power granted in the listing agreement. Hopefully, this overview is a helpful framework as you continue to work with extraordinary care to help sellers reach their goal of selling real property, whether it’s during a pandemic or less stressful times. As always, members with specific questions are welcome to call the Florida Realtors legal hotline, particularly when dealing with challenging issues like resolving differences between brokerage company and owner.

Joel Maxson is Associate General Counsel for Florida Realtors

© 2020 Florida Realtors®

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COVID-19 Changed a Lot — Here’s a Recap of Legal Resources

Ideally, real estate forms and the law offer an outline for performance if unexpected events arise during the course of a transaction – but not all answers during this global pandemic are clear. As a result, new disclosures, explanations and educational videos have been added within the past month.

Florida Realtors is monitoring everything regarding how the COVID-19 pandemic is affecting the real estate industry and Realtors and sharing it here.

ORLANDO, Fla. – Ideally, real estate forms offer an outline for performance if unexpected events arise during the course of a transaction – but a global pandemic hasn’t been one of them. As a result, new disclosures, explanations, and educational videos have been added to the Florida Realtors coronavirus page within the past month.

Forms added recently

Other legal support tools

Videos related to COVID-19

© 2020 Florida Realtors®

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Trump, Congress Near Deal on Small Business, Hospital Aid

While details could change, the next round of funding would add $300B to the Paycheck Protection Program, and $50B to the small business disaster fund. Along with a small business boost, this package will likely include financial aid for hospitals and $25B for testing.

WASHINGTON (AP) – The Trump administration and Congress expect an agreement on an aid package of up to $450 billion to boost a small-business loan program that has run out of money and add funds for hospitals and COVID-19 testing.

As talks continued, President Donald Trump said there’s a “good chance” of reaching a bipartisan agreement with Democrats.

“We are very close to a deal,” Trump said Sunday at the White House.

Florida Realtors is monitoring everything regarding how the COVID-19 pandemic is affecting the real estate industry and Realtors and sharing it here.

Along with the small business boost, Trump said the negotiators were looking at “helping our hospitals,” particularly hard-hit rural health care providers.

The Senate was scheduled for a pro forma session Monday, but no vote has been set. The House announced it could meet as soon as Wednesday for a vote on the pending package, according to a schedule update from Majority Leader Steny Hoyer, D-Md.

With small-business owners reeling during a coronavirus outbreak that has shuttered much economic activity, Treasury Secretary Steven Mnuchin said he was hopeful of a deal that could pass Congress quickly and get the Small Business Administration (SBA) program back up by midweek.

“I’m hopeful that we can get that done,” Mnuchin said Sunday.

Senate Minority Leader Chuck Schumer, D-N.Y., also said he believed a deal could be reached. “We still have a few more details to deal with,” he said.

The emerging accord links the administration’s effort to replenish a small business program with Democrats’ demands for more money for hospitals and virus testing. It would provide $300 billion for the small business payroll program, and $50 billion would be available for the small business disaster fund. Additionally, it would bring $75 billion for hospitals and $25 billion for testing, according to those involved in the talks.

On a conference call Sunday afternoon that included Trump, Mnuchin and Republican senators, Senate Majority Leader Mitch McConnell, R-Ky., indicated the only remaining item for discussion involved the money for testing, according to a Senate GOP leadership aide who spoke on condition of anonymity to discuss a private call.

But Democrats have been insisting on boosting funding to cash-strapped states and local governments whose revenues have cratered. In weekend talks, they had proposed $150 billion for the effort.

“We are pushing hard,” Schumer said.

But Mnuchin and McConnell reiterated on the call with senators that money for state and local governments as well as food stamps would not be included in the package, according to the GOP aide.

“The president is willing to consider that in the next bill, but wants to get this over the finish line with a focus on small businesses, hospitals and testing,” Mnuchin said. He said he’s been in touch with GOP leaders including House Minority Leader Kevin McCarthy, R-Calif., and all are “on board with the same plan.”

House Speaker Nancy Pelosi, D-Calif., predicted an agreement would be reached “soon.”

Under the emerging deal, the government’s Paycheck Protection Program for small businesses would get roughly $300 billion, according to Mnuchin. The Small Business Administration program has been swamped by companies applying for loans and reached its appropriations limit last Thursday after approving nearly 1.7 million loans. That left thousands of small businesses in limbo as they sought help. An additional $50 billion in the evolving deal would go for disaster loans.

About $75 billion would go to U.S. hospitals, for those straining under a ballooning coronavirus caseload as well as those struggling to stay financially afloat after suspending elective surgeries during the pandemic. About $25 billion would be added for COVID-19 testing, something states have said was urgently needed.

Republican Maryland Gov. Larry Hogan, who leads the National Governors’ Association, said he and other governors believe that aid for state and local government is “desperately needed,” but that it may not be an issue worth fighting over for now.

Democratic New York Gov. Andrew Cuomo said states needed money from the federal government to ramp up testing, and he blasted legislation that wouldn’t provide it.

The SBA loans, based on a company’s payroll costs, offer owners forgiveness if they retain workers or rehire those who have been laid off. The law provides for forgiveness for companies in any industry – even businesses like hedge funds and law firms. There’s a limit of $100,000 on the amount of employees’ compensation that can be considered when loan forgiveness is calculated.

Mnuchin, Schumer and Hogan appeared on CNN’s “State of the Union,” and Clark spoke on CBS’ “Face the Nation.”

Copyright 2020 The Associated Press, Hope Yen and Lisa Mascaro. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission. Associated Press writer Andrew Taylor contributed to this report.

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How Do COVID-19 Billing Accommodations Affect Credit Scores?

Under the CARES Act, a credit score’s account status and payment history can’t be lowered if the borrower follows agreement rules – but past problems won’t be erased.

NEW YORK – If you’ve been affected by COVID-19, you may be eligible for relief in paying bills. That can help you prevent damage to your credit from late payments at a time when protecting your credit could help increase your financial resilience.

But hardship and forbearance programs are not automatic – you have to apply for most of them. And you’ll want to understand how they will affect your credit reports and scores.

Florida Realtors is monitoring everything regarding how the COVID-19 pandemic is affecting the real estate industry and Realtors and sharing it here.

How the cares act affects credit reporting

The Coronavirus Aid, Relief, and Economic Security Act signed into law last month gives consumers some credit protections. It dictates how companies that send data to the credit bureaus will report accounts for which consumers have payment accommodations in place.

If you have an accommodation and you live up to your end of the deal, an account that had been current previously will continue to be reported that way for both account status and payment history, credit expert John Ulzheimer says. But it won’t wipe the slate clean of preexisting negatives: If the account had been delinquent, it will still be reported that way unless you bring it current.

You also can ask lenders to add a code to your credit report to indicate you were “affected by a natural or declared disaster.” FICO does not consider the codes when calculating credit scores, but VantageScore will disregard late payments for accounts with that code in effect.

A disaster code could make a difference if a lender actually reads the full credit report when making a decision, such as in hand-underwriting, says Ed Mierzwinski, senior director, Federal Consumer Program at the U.S. Public Interest Research Group, a consumer advocacy group.

Why your credit matters right now

In a financial crisis, access to credit is the next best thing to a fat emergency fund. If you protect your credit, you’ll have more or better options when you need them, such as being able to qualify for a low-interest loan.

The most important factor for protecting your credit is not missing a payment. A payment that’s more than 30 days late can cause your credit score to plummet, and the mark can stay on your reports for seven years. Your score could also drop if you are using more of your credit limits, but that damage is more quickly fixed. Your score will rebound once you can pay balances down.

How should I handle my bills?

If you’re not going to be able to pay bills in full, you’ll need to prioritize and get some breathing room. Here’s how:

Contact creditors and ask what’s available: Chi Chi Wu, a staff attorney at the National Consumer Law Center, points out that it’s the consumer’s responsibility to reach out and get an agreement despite long wait times on the phone and overtaxed websites.

You may be able to get a lower payment temporarily, skip some payments or get a higher credit limit. Terms of hardship programs vary. Connect with your credit card issuers and lenders – for mortgage, student loans, car and personal loans, etc. – to find out about options.

Document terms of any agreement: Be sure to document any agreement, whether with screenshots or copious notes about a phone call. Record when you called and whom you talked with. Save emails and other communications.

Make sure you understand all the details, such as start and end dates, and implications. For instance, creditors could theoretically reduce your credit limit or otherwise make it harder to access credit if you ask for payment modifications. But the risk is small, Mierzwinski says. Credit card issuers use algorithms to help figure out how likely you are to repay them after this crisis is over, and they still want customers, he says.

Check your credit reports: Wu advises checking your credit reports at least 30 days after any agreements take effect to make sure that the accounts are being reported correctly.

You are entitled to at least one free annual credit report from each of the three major bureaus. If you see accounts reported as late when you have an accommodation in place – or any other errors – dispute the information right away to protect your score.

Guidance issued April 1 by the Consumer Financial Protection Bureau says that because of coronavirus, credit bureaus will have 45 days to correct errors on credit reports (they usually have only 30).

Other things to consider

If you normally pay bills by autopay, review those. Change them as needed so you don’t overpay accounts or cause an overdraft.

Though utility bills are not typically reflected on your credit reports, it’s smart to add utility companies to the list of creditors you call. Like credit card issuers and lenders, many now have hardship programs for customers affected by the pandemic.

If cash is so short that even with concessions you are not going to be able to pay, know how to prioritize the most important bills and seek sources of help.

Copyright 2020 The Associated Press, Bev O’Shea of NerdWallet. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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Early Trends Indicate Fewer Sales but Still Rising Prices

Based on limited reports, it appears buyers still outnumber sellers even as the number of each declines. In early virus hot-spot Seattle, listings still have bidding wars.

ORLANDO, Fla. – Thanks to COVID-19, some buyers have pushed the pause button on their home search – but many sellers have simultaneously pushed the pause button on listing their home.

As a result, it appears that total home sales will decline as the pandemic reaches its peak, but the price of homes will result in the new balance between buyer demand and supply – and early indications seem to suggest that buyer demand continues to outstrip supply.

Seattle, for example, was the first virus hot spot in the U.S., and its real estate market continues to be strong, albeit with fewer listings to choose from. Even as stay-at-home orders in Washington State remain in place, Seattle continues to see a lively level of home purchases marked with bidding wars and all-cash offers hours after listings go live, The Wall Street Journal reports.

Cases of coronavirus have slowed in the city, which has prompted more buyers to emerge, though in-person showings remain limited. One couple submitted four written offers on homes over the past three weeks in the Seattle suburb of Bellevue, and those offers – each around $1 million – were outbid and rejected.

The city’s fast-growing tech sector appears to make local housing resilient against overall economic slowdown from the coronavirus. Amazon, headquartered in Seattle, is hiring 100,000 new workers in the U.S. in response to the pandemic. Google and Microsoft, also based in Seattle, are seeing a rise in consumer demand, as are streaming video companies and online videogame makers. Home buyers are looking to move to Seattle suburbs, and new residents continue to move in from out of state, real estate pros report.

Still, many sellers removed their homes from the market during this time, and the number of new listings is down 67% compared to a year ago.

Regardless, the number of homes and condos sold in the first week of April was higher than the same time period in each of the past two years. That also follows a 9.1% increase in Seattle-area sales in March compared to a year prior, according to data from the Northwest Multiple Listing Service.

“The market is still very active,” Dean Jones, principal and owner of Realogics Sotheby’s International Realty, told the Journal. Jones says that clients who work in the tech field are making up most of his company’s new business.

“While there’s plenty of concern, there’s a ‘this too shall pass’ perspective,” Jones says.

While the mix of jobs and buyers is different in Florida cities, the trend also seems to suggest that buyers continue to outnumber sellers. An April 15 report from the Orlando Regional Realtors Association finds that home sales improved and the median sales price increased in March in Orlando. The association recorded 3,204 home sales in March, up 27% from February and 2% from March 2019.

The 7,341 homes in inventory last month marked a 7.6% decrease from February and a 9.6% drop from March 2019. The median sales price was $253,500, up 1.4% from February and 7.9% from March 2019.

Meanwhile, Zillow reports that listings fell locally by 27% from April 5, 2019, to April 5, 2020.

Reese said a slowdown in sales is all but inevitable, but the extent is still unclear.

Beth Hobart, a Realtor with Orlando-based Mainframe Real Estate, said, “It’s important to remember that we’re in a global pandemic, not a real estate recession. Orlando is a vibrant destination in great demand to new residents, international home buyers, investors, etc.”

Source: “Despite Stay-at-Home Order, Seattle’s Real Estate Market Continues to Show Up,” The Wall Street Journal (April 13, 2020); Orlando Business Journal (04/15/20) Soderstrom, Alex

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MONEY Mag. Selects ‘Best Mortgage Lenders Of 2020’

Quicken took the overall No. 1 spot, but Navy Federal was deemed best for VA loans, and Guild Mortgage Company for first-time borrowers due to its range of options.

DORADO, Puerto Rico – MONEY magazine announced its “Best Mortgage Lenders of 2020,” along with expert analysis on the current state of the housing market. The analysis also includes information on other ranking services, such as the Mortgage Bankers Association (MBA), for a comparison.

MONEY says it researched and compiled a one-stop-shop to better understand the elements at play in the current market that’s being affected by the COVID-19 pandemic, and which mortgage companies are coming out on top.

MONEY’s top mortgage lenders

  • Best Overall Mortgage Lender: Quicken Loans – chosen because of their nationwide reach combined with excellent customer service (Also No. 1 in MBA’s ranking)
  • Best Mortgage Lender for First-Time Home Buyers: Guild Mortgage Company – selected because of their range of credit options (No. 12 in MBA’s ranking)
  • Best Mortgage Lender for Military: Navy Federal – chosen because it is the world’s largest credit union, the fourth-ranking VA loan originator, and one of the best lenders with a standout customer satisfaction rating (No. 13 in MBA’s ranking)

Before COVID-19 turned into a pandemic, mortgage rates fell to a 50-year low, and MONEY said it wanted to know how the shift is affecting homeowners and potential buyers. Overall, they found that ambiguity continues, but the demand for homeownership endures and interest rates remain low.

© 2020 Florida Realtors®

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Some Appraisals Can Be Delayed Until After Closing

Federal regulators will allow banks to postpone appraisals on residential or commercial property for up to 120 days after closing if the lender keeps the mortgage – but loans destined for FHA, Fannie Mae, Freddie Mac, etc., also have more lenient appraisal requirements.

WASHINGTON – Federal banking regulators issued new guidance last week that will allow banks to postpone an appraisal on a residential or commercial property for up to 120 days after the mortgage has closed in certain cases.

The rule applies only to mortgages that the banks intend to keep in their portfolios. It’s in effect until Dec. 31, 2020.

Federal banking regulators said the change was made to “extend financing to creditworthy households and businesses quickly in the wake of the national emergency” during the COVID-19 pandemic.

The new rule was announced by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corp., and the Office of the Comptroller of the Currency.

Meanwhile, mortgages sold or guaranteed by the Federal Housing Administration (FHA), Department of Housing and Urban Development (HUD), Department of Veterans Affairs, Fannie Mae, and Freddie Mac will continue to need an appraisal before closing.

However, those agencies have eased their appraisal standards as well. In select cases, for example, “qualifying principal or primary residence loans, desktop appraisals and exterior-only appraisals will now be acceptable.” The FDIC offers more information on its website.

Source: FDIC.gov and “Banks Will Soon be Able to Postpone Some Appraisals Until 120 Days After the Mortgage Closes,” HousingWire (April 14, 2020)

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Fla. Unemployment: Few Checks Have Gone Out the Door

Gov. DeSantis said Thur. that checks have gone to about 4% of the people who applied so far. A dedicated website for independent contractors is expected in about a week.

TALLAHASSEE – Payments have been made to roughly 4% of the more than 800,000 people who have filed jobless claims since the novel coronavirus started closing businesses across the state. Gov. Ron DeSantis told reporters Thursday that checks have been sent to 33,623 people who have applied for benefits since the beginning of March through the troubled unemployment-compensation system.

With early qualifiers drawing multiple checks, about $50 million has gone out in state assistance – in checks of up to $275 a person a week.

Separately, 23,801 checks have gone out to people who have qualified for federal money under a new federal stimulus law. The federal payments go up to $600 a week.

“While we’ve made some progress in the recent days, it’s not nearly enough. We’ve had an unprecedented number of claims and we have to work through them,” DeSantis said.

Unlike Florida unemployment benefits, the federal payments fall under the CARES Act passed by Congress to stave off negative economic impacts from COVID-19 pandemic, and independent contractors – a job classification for most real estate agents – qualify for federal benefits. However, website problems and the lack of an application process have delayed those benefits for now. An expected fix will take up to 10 days.

On Wednesday, DeSantis removed Department of Economic Opportunity Executive Director Ken Lawson from oversight of the CONNECT unemployment system. He put the system, which cost $77 million to get online in 2013, into the hands of Department of Management Services Secretary Jonathan Satter.

Part of the reason was an inability of Lawson’s department to provide daily updates on claims and payments.

Jobless benefit requirement waived

On Thursday, DeSantis signed an executive order that eliminated a requirement for people who qualify for jobless benefits to recertify their claims every two weeks, Executive Order 20-104.

“Even though I had told them to waive any needless bureaucratic rules, I had to today sign an executive order to suspend the need for people to return to the CONNECT system to recertify their unemployment status,” DeSantis said. “We understand what is going on with the economy now. We hope it’s short term, but clearly this is not something that if you look hard enough you’re going to find a new job.”

DeSantis added that the change will relieve some stress but isn’t a “silver bullet” to speed the process.

To try to address issues with backlogs and problems with filing applications, hundreds of call-center operators have been rushed through training, paper applications have been made available and more than 100 computer servers have been brought in.

Satter said efforts continue to make the system more accessible to gig workers – including independent contractors – who don’t qualify for state assistance but do qualify for the federal benefits.

“We’re building a separate portal for those gig workers, independent contractors, and we’re hoping to have that ready in about a week to 10 days,” Satter said on Thursday.

DeSantis said he will have his first meeting by phone Friday with a task force designed to help devise plans to reopen services and businesses across the state. Members of the task force haven’t been named, but DeSantis said he wants proposals on reopening quickly.

“It’s not going to be something that’s going to take four weeks,” DeSantis said. “This is something within a three-to-five-day period, I want the best ideas we can get.”

Source: News Service of Florida, Jim Turner

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Foreclosure Rates Hit Generational Low Before Coronavirus

While the pandemic has sparked economic fears, the housing market started from a position of strength: According to CoreLogic, Jan. foreclosures fell to a 20-year low.

NEW YORK – Mortgage delinquencies in January fell to their lowest level in more than 20 years, driven by a strong job market and low interest rates.

Some 3.5% of home loans were in some stage of delinquency, compared to 4% in January 2019, according to CoreLogic.

Early-stage delinquencies declined to 1.7% from 1.9% over the same period. The share of mortgages 60 to 89 days past due in January was 0.6%, down from 0.7% during the same month last year. And the serious delinquency rate (90 days or more past due, including loans in foreclosure) was 1.2%, down from 1.4%. It was the lowest serious delinquency rate since 1% in April 2000.

Meanwhile, the foreclosure inventory rate was 0.4%, unchanged from January 2019. That tied the lowest monthly rate since at least January 1999.

“After some initial cushioning from equity buffers, lower mortgage interest costs and government support and forbearance programs, we expect delinquency rates to jump significantly throughout the year as the economic toll from COVID-19 becomes more evident,” says CoreLogic President and CEO Frank Martell.

Martell says not all cities will feel the same effects.

“It is likely that areas of the country that have local economies driven by energy, transportation and media and entertainment will lead the way in delinquencies,” he says. The ultimate extent of the higher delinquencies will depend on how quickly the broader economy opens up again and employment levels rebound – both of these factors are uncertain at this time.”

Source: National Mortgage News (04/14/20) Centopani, Paul

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Coronavirus Downtime May Be Entrepreneurial Opportunity

Many entrepreneurs see an opening to start their own business or branch out into a new specialty but don’t have time to pursue it. Now they do.

NEW YORK – For would-be entrepreneurs who have longed to turn a side hustle into their main hustle, the shutdown created by the coronavirus may have provided that long-awaited opportunity.

Often, a lack of time is one of the major reasons people give for not starting their own businesses. But these days – with everyone urged to stay home and outside activities limited – those newfound extra hours could be invested in taking steps toward creating that business, says Shravan Parsi, CEO and founder of American Ventures, a commercial real estate company, and ForbesBooks author of The Science of the Deal: The DNA of Multifamily and Commercial Real Estate Investing.

“It definitely takes effort, energy, and a willingness to step out there, but the rewards can be great,” Parsi says.

Parsi was a full-time pharmaceutical research scientist working 9 to 5 and dabbling in real estate on the side when he realized his regular job was hampering his real estate deals because he wasn’t available to talk with people or show a house during the day. Eventually, he bid farewell to his old career and launched his new one in commercial real estate.

Parsi has a few tips for those who long to shake loose from their current careers and venture into something that drives their passions:

Be bold and flexible. A willingness to take chances and adapt to changing circumstances is critical. Even in seventh grade in his native India, ambition boiled in Parsi. He realized that to become the kind of global leader he aspired to be, he would need to know English. So, he transferred to an English school. “My parents supported my decision even though they knew it would be challenging,” he says.

Be interested in everything and observe closely. You never know when opportunities to expand your knowledge – and be inspired by new ideas – will present themselves. Parsi says he learned this lesson at age 14. His father was a doctor who himself invested in real estate as a passive investment and was having a two-story house built – one story for the family and one as a rental. “He pointed out that I had time to kill over summer vacation and recommended I watch the process,” Parsi says. “So my brother and I watched the construction and supervised the contractors. It left a strong impression on me.”

Pivot when necessary. Life doesn’t always go as planned – as the coronavirus has shown – so you need to be prepared to change direction, Parsi says. As an example, Parsi originally planned to follow in his father’s footsteps and become a doctor. But admission to medical school in India is highly competitive and he missed the cutoff criteria by one-tenth of a point. That’s when he pivoted and became a pharmaceutical scientist instead.

Learn how to sell anything. At different periods in his life, Parsi worked in a cell phone store, sold Amway products, and sold nutritional supplements. Those experiences weren’t always the best, he acknowledges, but he did gain something from them. “I realized that if I can sell the products and a story and recruit others, then I can sell anything,” Parsi says. “Selling is a pivotal skill most entrepreneurs must have.”

Anyone who is inspired to get their entrepreneurial drive moving during the current downtime should not completely throw caution to the wind, Parsi says.

“I did not quit my pharmaceutical job right away,” he says. “I had an objective to stay in that job until the real estate income was twice the value of my salary. When I hit that objective – when real estate was no longer a side hustle – I decided it made sense to invest more time in real estate than the scientific position.”

Now American Ventures is a successful multifamily and commercial real estate investment firm with a proven track record.

“Never settle for less,” Parsi says.

© Copyright 2020 Omaha Star. All rights reserved.

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6 Ways Real Estate Pros Can Reduce Their Taxes

Since the IRS moved tax-deadline day to July 15, Realtors have more time to maximize tax deductions, and a self-employed status can help them do so.

WASHINGTON – Since the IRS moved tax-deadline day to July 15, Realtors have more time to maximize tax deductions, and a self-employed status can help them do so.

Many agents and brokers classify themselves as self-employed under federal tax guidelines. Income tax, therefore, is not automatically withheld from paychecks and generally must be paid through quarterly estimated tax payments.

Self-employed status also means real estate pros may be eligible to deduct business operation expenses. Homesnap, a national real estate search portal, recently highlighted tips from tax accountant Brian Stitcher with JBS & Company LLC in Stevensville, Md. Here are six:

  1. Deduct any fees, licensing expenses, membership dues and insurance premiums related to your job. Compile records of any dues or fees you incur as an agent or business owner, such as MLS dues, state license renewals, real estate association dues and brokerage desk fees. They’re considered deductible business expenses.
  1. Keep track of all expenses related to your car, such as maintenance, repairs, mileage, parking, replacement. “Between home showings and professional conferences, agents frequently travel across their home state and the country; however; when filing their tax returns, many leave money on the table when it comes to travel and transportation,” says Stitcher. According to the IRS, you can deduct $0.58 per mile driven for work as well as any expenses for car maintenance or repairs, parking fees or new car purchases. For any education or business purpose that requires further travel, agents can claim: travel airfare, lodging and meals (up to 50% deduction on the cost of meals).
  1. Deduct marketing and advertising expenses. Marketing your business and brand is a big part of acquiring leads. Marketing tactics can include physical materials like flyers, promos, business cards, and digital materials such as website development, ads on Instagram, Facebook, Waze or Google. Most of these costs are a deductible business expense.
  1. Include classes and coursework. To stay ahead of the competition and well versed in the latest trends in real estate, agents often engage in real estate coaching, seminars, and training. Registration fees or any other education-related costs can be deducted. (This might make costs associated with attending Florida Realtors Convention & Trade Show deductible too.)
  1. Consider technology deductions. Business equipment such as your computer, any software fees or purchases, office supplies and even your cell phone are considered deductible expenses. “Agents or brokers that permanently work from home may also be able to claim expenses related to maintaining their home office,” Stitcher says.
  1. Don’t forget those closing gifts. Offering small gifts after the selling process is complete is an important way to maintain client relationships and loyalty. According to Stitcher, you can only deduct $25 per person per year or, if your client is a couple, $50 per couple per year.

Source: Homesnap

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RE Q&A: What If a Landlord Insists on Paying Rent with Cash?

A lease requires cash payments, but if the renters make a trip to the bank it violates emergency pandemic orders and seems unsafe. Do renters have another option?

FORT LAUDERDALE, Fla. – Question: Our lease states that we must pay the rent in cash. Because of the Safer at Home orders in place, we do not want to go to the bank to get the money. We offered to pay with a check or even have our bank transfer the funds, but our landlord refused. We want to stay safe during the pandemic. What can we do? – Amanda

Answer: It is crucial always to get a receipt when paying your rent in cash. You agreed to pay your landlord in cash, and that is what you should do when possible.

But the unexpected sometimes happens, and even a well-drafted lease cannot foresee every situation. The COVID-19 pandemic caught the entire world unawares, and implicit in every contract is the promise that the parties will deal fairly with each other in good faith.

Given the current situation, my legal opinion is that your landlord is required to accept an alternate form of rent, and if he refuses, you will not be in breach of the lease.

You should be documenting all communication with your landlord about this issue. Save emails, texts, and take a picture of the written check. If he later chooses to try to evict you, these notes will be critical to your defense.

I find his refusal to accept a check to be very suspicious. With the massive unemployment, most landlords are happy to have tenants eager to pay rent. This is especially true since Florida and most states have delayed residential evictions for the next month or two.

When renting a home, the landlord will check out the tenant before agreeing to let the property. It is equally important for a tenant to make sure the landlord is legit.

The fact that your landlord is demanding cash payments opens the possibility that he may not be who he says. Check your county property appraiser’s website to confirm who the owner is. Any legit landlord would be willing to show their driver’s license to prove they are who they say they are.

Rental fraud is more common than most people think, and tenants have to be diligent.

About the writer: Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He practices real estate, business litigation and contract law from his office in Sunrise, Fla. He is the chairman of the Real Estate Section of the Broward County Bar Association and is a co-host of the weekly radio show Legal News and Review. He frequently consults on general real estate matters and trends in Florida with various companies across the nation.

© 2020 Sun Sentinel (Fort Lauderdale, Fla.), Gary M. Singer. Distributed by Tribune Content Agency, LLC.

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New-Home Construction Fell 22.3% in March

Construction of single-family houses fell 17.5%, while apartment and condo starts were off 32.1% compared to February’s numbers.

WASHINGTON (AP) – U.S. home-building activity collapsed in March as the coronavirus spread, with housing starts tumbling 22.3% from a month ago.

The Commerce Department said Thursday that ground breakings occurred last month at a seasonally adjusted annual rate of 1.2 million units, down from a 1.56 million pace in February. Construction of single-family houses fell 17.5%, while apartment and condo starts were off 32.1% from a month ago.

All of this paints a bleak outlook for housing as the lockdown to contain COVID-19 has led more than 20 million Americans to lose their jobs in the past four weeks.

There was a 6.1% decline in the completion of homes being constructed, which means many homes are being left half built. The drop was 15% of single-family houses, meaning that unless economic activity picks up soon there could be ghost towns of half-built housing developments, a phenomenon last seen in the aftermath of the 2008 financial crisis.

Construction activity will likely continue to slow. There was also a 6.8% drop in permits to begin construction in March.

Homebuilders have become fearful. A confidence index released Wednesday by The National Association of Home Builders and Wells Fargo plunged 42 points in April to a reading of 30, the largest single monthly change in the history of the index. Any reading below 50 signals a decline.

Copyright 2020 The Associated Press, Josh Boak. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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Mortgage Rates Drop Again – 30-Year at 3.31%

Rates are hovering near all-time lows for the third week in a row as economists and businesses try to weigh the economic damage caused by the pandemic.

WASHINGTON (AP) – U.S. long-term mortgage rates hovered near all-time lows for the third straight week amid fresh signs of severe damage to the economy and the housing market from the shutdown spurred by the coronavirus pandemic.

Mortgage buyer Freddie Mac reported Thursday that the average rate on the benchmark 30-year home loan slipped to 3.31% this week from 3.33% last week. A year ago the rate stood at 4.17%.

The average rate on the 15-year fixed-rate mortgage rose to 2.80% from 2.77% last week.

Demand from prospective homebuyers has weakened amid economic anxiety, and the housing market has been upended by the pandemic just as it was entering the busy spring season.

Meanwhile, the government reported Thursday that U.S. home-building activity collapsed in March as the virus spread, with housing starts tumbling an alarming 22.3% from a month earlier. The data pointed out the bleak outlook for the housing market as the economic disruption brought job losses for more than 20 million Americans in the past four weeks, as another government report showed Thursday.

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Small Business Loans: SBA Says It’s Run Out of Money

Businesses hoping for federal relief under the $2.2 trillion CARES Act will apparently have to wait if they do not yet have a loan number. Congress generally agrees to add funds to its rescue programs but disagrees on details, such as the amount allocated to minority-owned businesses.

WASHINGTON – Businesses hoping for federal relief under the $2.2 trillion CARES Act will have to wait, as funds allocated have apparently run dry.

Two Small Business Administration programs designed to help businesses weather the pandemic – the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) – have apparently run out of funds.

Florida Realtors is monitoring everything regarding how the COVID-19 pandemic is affecting the real estate industry and Realtors and sharing it here.

“Late last night, early this morning, the funds have probably all been earmarked and accounted for,” John Fekete, a partner at Baratz & Associates P.A., a Marlton, New Jersey-based accounting firm, told this website Thursday morning.

Fekete said he has “a fair amount” of clients who have gotten PPP loans approved, although none have yet received funding. Under the PPP, borrowers with less than 500 employees can apply for a loan up to $10 million loan that is potentially forgivable.

“If you get a loan number, the money’s been earmarked,” he said. “I have not had any clients that actually have gotten the funds wired into their account.” He said once a company receives what’s known as an “E-tran” number, the money is supposed to be wired within 10 days.

“We’re sort of in this waiting period right now to see if the money is actually going to get in there,” Fekete said.

Accountant: Don’t give up hope

Small businesses (those with less than 500 employees) that have not applied for a PPP loan yet should not consider themselves out of the picture, Fekete said, depending on when the government approves additional funds.

“Right now, Congress is talking about adding $250 billion to the $350 (billion) that was made available,” he said. “It sounds like it’s going to get done after some politicking, maybe early next week. I assume once they do that, anyone that’s been shut out now will have another opportunity to apply for it.”

Fekete encouraged small businesses to prepare the necessary paperwork and speak to their bank rather than going onto the SBA website to apply for a loan. The PPP loans are being managed by the banks.

Business owners who have contacts at small community banks should work with those banks, he said, since smaller banks participating in the PPP are acting faster than large ones.

“These big banks are slow to process, just because of the sheer volume that they get, whereas the smaller community banks have less paperwork to process,” he said. “They can get things done a lot quicker.”

Fekete said he is optimistic that additional funds will be approved. “It’s just a matter of the Republicans and Democrats playing their games and finally getting it through,” he said.

As of Wednesday evening, the SBA approved more than 1.4 million loans totaling $315 billion under the PPP, according to a report in The New York Times.

Political gridlock

The Trump Administration and Republicans in Congress have sought a cash infusion for the program, but Democrats have asked for assurances the funds would go to companies traditionally disadvantaged in the lending market, including minority-owned businesses, according to The New York Times. Democrats also want funds to be available to state and local governments, food stamp recipients and hospitals. Republicans have objected to these additional stipulations as part of the initial refunding, claiming it should be considered later.

While more than a million loan applications have been approved, many banks are still waiting for greater clarity over liability if new loan applicants don’t follow PPP rules and for more guidance on how to process applications for self-employed businesspeople and independent contractors, according to a Marketwatch report.

In addition, SBA data indicates much of the approved funds have been approved for the larger small businesses. The average loan size approved was $239,152, according to data it released Tuesday.

Emergency disaster loans also in peril

The SBA announced on its website that it is unable to accept new applications at this time for the Economic Injury Disaster Loan (EIDL)-COVID-19 related assistance program (including the EIDL advances) based on available appropriations funding. Applicants who have already submitted their EIDL applications will continue to be processed on a first-come, first-served basis.

“It looks like that money has been exhausted as well,” Fekete said.

Under the direct lending loans for these mid-size businesses, companies could apply for a loan up to $2 million. And while the loan is not potentially forgivable like the PPP loan, borrowers could receive a $10,000 grant that did not have to be repaid.

The $10,000 grant has been reduced to $1,000 per employee, according to an email to EIDL loan applicants. Loggins Kern & McCombs, a Jonesboro, Georgia based accounting firm, posted a copy of the email the SBA sent to some of its clients which says that to ensure the greatest number of applicants receive assistance, the advance will provide $1,000 per employee up to $10,000.

A couple of his clients got the $10,000 grants, Fekete said. “That was advertised that you were going to get $10,000 within three days,” he said. “I had two or three clients where that actually did happen, but that’s about it. Many more applied and they’re still waiting.”

Will Congress act fast?

Meanwhile, businesses are urging the government to act fast on approving more funding.

The Electronics Transactions Association, whose members – banks and fintech lenders – have helped tens of thousands of American small business owners access billions of dollars under the PPP, has urged Congress to act swiftly to allocate additional funds.

“As the PPP has reached the limit set by Congress, there are thousands of small businesses that still need access to PPP funds,” Jodie Kelley, ETA CEO, said in a statement. “We urge Congress to act swiftly to allocate additional funds to the PPP.”

Copyright © 2020 Networld Media. All rights reserved.

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DeSantis Revamps Leadership of Unemployment System

Fla.’s beleaguered unemployment-comp system has new leadership. The new head’s “mission is very simple – get assistance out and as quickly as you can,” DeSantis says.

TALLAHASSEE, Fla. – Gov. Ron DeSantis on Wednesday shook up oversight of the state’s unemployment-compensation system, which has struggled with a massive surge in applications because of economic fallout from the novel coronavirus.

In this guide specifically for Realtors, you’ll find out if you qualify to receive unemployment, what’s going on with Florida’s system and how long it could take for you to get relief.

DeSantis put Department of Management Services Secretary Jonathan Satter in charge of the troubled CONNECT online unemployment system, taking over from Department of Economic Opportunity Executive Director Ken Lawson.

“His mission is very simple, get assistance out and as quickly as you can,” DeSantis said of Satter.

DeSantis added that he hopes Satter will “rattle the cage,” as the unemployment system continues to draw complaints as record numbers of claims have poured in during the past month. DeSantis said he has been unable to get the updated information he wants.

“I’d like to be able to come out and say X number of checks went out yesterday. X number of checks are going to go out by 5 o’clock, or whatever you have,” DeSantis said. “I don’t think that the response has been sufficient in that regard.”

Last Thursday, DeSantis said 225,755 initial claims had been filed since the previous Sunday, putting the state on pace to top the record 228,484 claims filed during the week ending March 28. Updated numbers were not available Wednesday.

Neither Satter nor Lawson attended Wednesday’s media briefing with DeSantis.

Lawson remains as head of the Department of Economic Opportunity, just in a role that is “non-COVID-related,” DeSantis said.

Lawson, who was appointed by DeSantis to head the department in December 2018, led agencies under former Gov. Rick Scott, moving from the Department of Business and Professional Regulation to Visit Florida. He headed the tourism-marketing agency as its spending was under fire from House leaders.

Both Satter and Lawson earn $142,000 a year in their jobs.

While DeSantis said he was “happy” in progress made to improve the online unemployment-application system, he remains “disappointed” in the website’s performance. Applicants have had difficulty filing claims, complaining about issues such as the system crashing.

The CONNECT system, which cost $77 million to get online in 2013, has been a subject of several critical reviews by the Florida auditor general, with the latest in 2019.

DeSantis said Satter and his staff at the Department of Management Services have been involved in overseeing upgrades to the CONNECT system. Satter will remain as Department of Management Services secretary while heading the unemployment system.

“I think he’s a logical person to be able to do it, given that he’s been so involved in the technical components so far,” DeSantis said.

Responding to the change, state Sen. Janet Cruz, D-Tampa, tweeted, “I hope this change will bring immediate relief to my constituents and all Floridians suffering with Florida’s broken unemployment system.”

Satter has been instrumental in getting more than 100 computer servers to increase the capacity of the system. Problems with the system have spurred the state to begin offering paper applications and to bring in more than 1,000 people to handle calls from people filing claims.

Satter was managing director of U.S. operations for the commercial real estate firm Avison Young from 2013 to 2018 before DeSantis appointed him to run the Department of Management Services, which oversees a wide range of issues including information technology.

Former Gov. Jeb Bush twice named Satter to the Health Care District of Palm Beach County, where he was board chair for four years.

Source: News Service of Florida, Jim Turner

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Survey: Real Estate Pros Bet on Post-Pandemic Rebound

In a time of uncertainty, it’s hard to accurately predict the future, but a majority of Realtors surveyed by NAR say today’s down market is a natural result of social distancing – but most buyers and sellers are just taking a break rather than leaving the market altogether.

CHICAGO – The spring housing market will be slower than normal due to stay-at-home orders by many states and municipalities to control the outbreak of COVID-19 – but the majority of real estate professionals see the slowdown as temporary. They’re optimistic that a turnaround will occur once social distancing measures are lifted.

Almost six of 10 Realtors® recently surveyed by the National Association of Realtors (NAR) reported that their buyers were delaying home purchases for a couple of months. It was similar on the seller side: 57% of real estate professionals said sellers were delaying home sales.

NAR’s Economic Pulse Flash Survey was conducted on April 5-6.

“Home sales will decline this spring season because of unique economic and social consequences resulting from the coronavirus outbreak – but much of the activity looks to reappear later in the year,” says Lawrence Yun, NAR’s chief economist.

Yun also predicts that home prices will remain stable “because of a pandemic-induced reduction in inventory coupled with less immediate concerns over foreclosures.”

Mortgage servicers also say they’re unconcerned about a flood of foreclosures hampering the housing market thanks to swift actions taken to offer forbearance options to out-of-work homeowners.

So far, most Realtors reported stable prices in their markets, with three out of four (72%) saying their sellers haven’t reduced asking prices to attract buyers. However, a majority of homebuyers (63%) expect prices to decline eventually, perhaps hoping that the temporary decline in buyers interest will translate into a buyer’s market after steps to fight the pandemic have been rescinded.

The survey also asked about monthly rental payments from tenants. Nearly half of the property managers surveyed (46%) said they’ve been able to accommodate tenants who cannot pay rent, and 27% of individual landlords reported the same.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act includes a provision for eviction prevention, as well as small-business loans and grants for assisting the rental market.

Real estate professionals are finding ways to work virtually to complete some transactions. The most common tools leveraged according to the survey are e-signatures, social media, messaging apps and virtual tours.

© 2020 Florida Realtors®

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Should Landlords Disclose COVID-19 Status of Tenants?

If the woman in 6A has COVID-19, should or should not a landlord tell the man in 6B? Some attorneys advise property managers not to reveal names or units.

CHICAGO – Building owners and homeowner association boards aren’t legally required to disclose if a tenant tests positive for COVID-19, real estate attorneys say. But they say city laws are changing quickly and COVID-19 disclosure requirement disclosures could change too.

Many landlords are reportedly telling tenants when a case of a COVID-19 infection surfaces in their buildings, even though they’re not required to do so. Some are sending emails or a memo to tenants to let them know when one of their neighbors has contracted the virus so that they can take extra precautions.

However, real estate attorneys are warning property managers and boards not to reveal who contracted the virus or which unit they live in. Also, the resident cannot be evicted because they’re sick.

“From a legal perspective, we’re in uncharted territory,” Scott Moore, a housing attorney with Baird Holm in Omaha, Neb., told realtor.com. “The federal Fair Housing Act prohibits inquiries into whether a tenant has a disability and the nature and extent of their disabilities. That would include questions about medical conditions.”

Some property managers are unsure how much they should reveal, particularly if they have elderly or vulnerable populations in their buildings, who may be most at risk of COVID-19. Some property managers may disclose the floor the sick person lives on, but some real estate attorneys caution that even that information could be jeopardizing the resident’s privacy.

“Disclosing against the wishes of the infectee could potentially expose the board to a lawsuit,” says Aaron Shmulewitz, an attorney with Belkin Burden Goldman in New York City who represents co-op and condo boards.

But buildings that fail to disclose an infected person lives there also could be putting them at risk of a lawsuit, adds Michael Spence, a real estate attorney with Helsell Fetterman in Seattle.

Legally, tenants do not have to let anyone in the building know about their health conditions and whether they have COVID-19. Ethically, some are arguing they should so that building managers and tenants can take more proactive measures.

“There’s no legal playbook for any of this,” Shmulewitz says.

Source: “Do You Have the Right to Know if Your Neighbors Have Coronavirus?” realtor.com® (April 3, 2020)

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Mortgages Now Tougher for Owners Who Lost Work

Record spikes in jobless claims are creating major roadblocks for consumers who thought that they’d like to save money by snagging a lower mortgage rate.

DETROIT – Record spikes in jobless claims are creating major roadblocks for consumers who thought that they’d like to save money by snagging a lower mortgage rate.

Maybe, you thought you might even refinance the mortgage to get your hands on some cash now by taking out some equity that’s built up as your home’s value has grown? Maybe you’re looking at your house as a piggy bank after losing a job during the coronavirus pandemic?

It’s a thought, but it’s a strategy that likely won’t work.

“For people who are unemployed, it’s going to be more difficult to qualify for a mortgage at this time,” said Bill Banfield, executive vice president of capital markets for Detroit-based Quicken Loans.

“The ability to repay debt is based on the person’s income.”

It’s not to say that people who aren’t working can’t refinance their mortgages, he said. Retirees, for example, may be able to refinance a mortgage if they can point to a steady pension or annuities that can be used to repay the debt.

Yet things are getting tougher for many people who want to refinance a mortgage than they were back in February and early March.

“Unemployment will certainly be an issue for folks trying to refinance,” said Keith Gumbinger, a mortgage expert and vice president at HSH.com, a mortgage information website.

While many people will receive jobless benefits, Gumbinger said getting an unemployment check typically isn’t viewed as a reasonable stream of income, which is necessary to qualify for a mortgage.

Federally-backed mortgages, including Fannie Mae and Freddie Mac, do allow for the use of unemployment benefits in the case of steady but seasonal employment. A seasonal worker, for example, can document that they received jobless payments consistently for at least two years and be considered for a mortgage.

“Unemployment compensation cannot be used to qualify the borrower unless it is clearly associated with seasonal employment that is reported on the borrower’s signed federal income tax returns,” according to regulations. And the lender must verify that the seasonal income is likely to continue.

No doubt, ultra-low mortgage rates make refinancing a mortgage quite tempting.

“Certainly, interest in refinancing has again kicked higher,” Gumbinger said.

Gumbinger noted that the pattern of refinancing activity in the last four weeks was up 78.6% for the week ending March 6, down 10.4% for the week ending March 13, down 33.8% for the week ending March 20 and now up 25.5% for refinance applications for the week ending March 27, based on data from the Mortgage Bankers Association.

The average conforming 30-year mortgage rate last week was 3.33% – down only slightly from a 3.6% range in January. A year ago, during late March, the average was 4.12%.

“Rates are still very low for the conforming, government-backed loans and it continues to be a refinancing bonanza,” said Greg McBride, chief financial analyst for Bankrate.com.

But he warned that lenders are experiencing a backlog of refinancing applications. Borrower demand has been exceeding the lender’s capacity to handle refinancing mortgages in many cases, McBride said.

Bankrate.com’s most recent research indicates that the average 30-year fixed rate is 3.74% as of the week of April 1. The average 30-year rate on a jumbo mortgage is 3.92%. Jumbo loans, which often require larger down payments, apply to mortgages that exceed $510,400.

While the coronavirus pandemic is stressful and shocking to everyone, we all aren’t facing the same challenges and issues. So you have to figure out what works for you.

“If you have lost your job or expect to, then refinancing probably won’t be possible,” said Mark Zandi, chief economist for Moody’s.

If you have lost a job, talking to your lender or mortgage servicer about coronavirus mortgage relief options, such as a way to delay making payments for 90 days, could make more sense.

“Asking for forbearance, which you should get if you have an FHA, Fannie or Freddie loan, should be your first priority. If your job isn’t threatened, and your existing mortgage has anything more than a 4% rate, you should be refinancing,” Zandi said.

© 2020 the Detroit Free Press, Susan Tompor. Distributed by Tribune Content Agency, LLC.

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Some Real Estate Investors See Opportunities

Investors don’t feel good about misfortune, but some expect landlords to struggle with mortgage payments and a few commercial sectors to undergo long-term changes.

NEW YORK – The COVID-19 pandemic has left no industry untouched. Many Americans and property owners didn’t have the cash to pay their rent this month. Which means some landlords are going to struggle with the mortgage, which means an opportunity for some property investors.

During the last financial crisis, there was a lot of distressed property to be had in South Florida.

Daniel Lebensohn, co-founder of the investment firm BH3, said buying that distressed debt built the foundation of his company. He said nobody feels good about taking advantage of misfortune, but firms will be looking at this pandemic in the same light.

“Now’s the time to innovate and go hunting because there will be opportunities,” Lebensohn said.

But KC Conway, chief economist at the CCIM Institute, thinks market changes will come in two phases.

“Phase one is really a repricing opportunity. And I think then the acquisition comes a little bit later, maybe six months down the road,” he said.

That’s because the real estate market moves slowly, and this pandemic is only a month old in the United States.

“It’s not as if anybody who owns anything is suddenly going to step up and say, ‘Oh, sure. A month ago, I could have sold this building for $400 a foot, but because I’m afraid of what’s happened in the market, you can buy for $200 per square foot,’” said Jim Costello, senior vice president at Real Capital Analytics.

He said it could get there at some point, it’s just not there yet.

And the hospitality sector is going to have an especially difficult time weathering this storm.

“Some of the areas like the hotels and the travel related … the restaurants, many of those are fairly tight on their cash flow and could actually be facing a situation where they need a buyer fairly soon,” said Calvin Schnure, senior economist at NAREIT.

And retail office space, one part of the market that many viewed as fairly safe, could be compromised because so many people have learned to work from home.

Copyright © Marketplace © 2020 APM, Andy Uhler. All rights reserved.

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Coach’s Corner: This Is Not the Time to Go Silent

A real estate coach thought she helped agents confront every possible challenge – then the pandemic hit. But buyers and sellers need Realtors now more than ever.

CHICAGO – As a real estate coach, I’ve helped my clients through every imaginable challenge in their business. But now with the pandemic, we’re all facing some unimaginable ones, too. My work training and supporting agents over the past six years (after more than 20 years as an agent myself in the Chicago and Boston areas) focuses on helping them develop strategies and tactics for boosting sales goals and identifying untapped sources of business.

Now, like all of us in real estate, I’ve had to shift my mission with the times. The daily schedules and routines that I’ve helped my clients develop and stick to are suddenly out the window when you can’t attend a networking group, meet people for coffee, or pick up clients for showings. It’s easy to feel at loose ends about how to run a real estate business in this environment.

The good news is, as I tell my clients, consumers who need to move forward with selling or buying a home may need your support and guidance more than ever as we navigate this uncertain business environment. I’ve been busy supporting my longtime clients and putting myself out there to help those who might be in need of a business coach for the first time. Social media has been a tremendous way to make those connections. I rely on my Facebook business page, Instagram, and LinkedIn, and I recently started a YouTube Channel, Coaching With Roxy.

As always, I am an accountability partner. And as we continue in this unexpected pivot in our business and our lives, I’m finding that many are intensely grateful for this kind of connection by phone or by screen. As I’ve been telling my clients lately, your buyers, sellers, and even your prospects need to hear from you with facts about what’s happening now with real estate and the economy, as well as some reassurance about the future. This is not the time to go silent.

My advice is not one-size-fits-all, as in some places, my clients are considered “essential” service providers, and others they are not. And I always reiterate that it’s critical to pay attention to the business and office policies adapted by your own managing broker, which could change by the week or the day.

Regardless of which state they are licensed in, my clients express many common concerns about getting through this challenging time. Here are some tips that I’ve shared with them that may help you stay on track.

1. Feel your feelings. First, and most important, take some time to sort through your feelings. You probably are juggling many different emotions right now, and I encourage you to honor them, rather than stuff them down. Among the big ones: fear (quite justified!), frustration (just one more thing setting me back!), confusion (how am I supposed to get my job done, and what should I say to my clients?), anger (I don’t need or deserve this right now!), overwhelmed (as if I don’t have enough to deal with already!), and panic (how am I supposed to make a living?).

The goal is to be gentle and patient with yourself. Take one thing at a time, one day at a time. But do take time.

2. Reach out to clients. Once you are clear on what you can and cannot do given state guidelines or local policies, and you’ve checked in with or heard from your managing broker, schedule appointments with your clients to have an important conversation about expectations over the phone or via web communication. Do your best to remain calm and communicate confidence and a sense of camaraderie. For example, you can remind them, “We are all in this together, we will figure things out along the way, and you are my highest priority.”

You may have clients that decide to put their plans on hold for the time being. That would be understandable. But, as we know, there are always people who need to move for one reason or another, and those folks will need extra care, counseling (this is a chance to show up as a consultant more than a salesperson), assurances, and, yes, some extra creativity on your part! But remember, at all times, follow health precautions necessary to keep you and your community safe.

3. Create a structure. You may find that working from home, with some clients on hold, creates extra time in your day. It’s more important than ever to use a calendar and follow a schedule. Consider color-coding your calendar; this helps to be sure you have a balance of activities. You don’t want your day to turn into a long blur of getting nothing accomplished. Dress as if you are going into the office or meeting a client; you’ll feel more productive. Set a time-block each morning for planning your day and a time-block at the end of the day to review what you got done and what is still left to accomplish. This will add some accountability to your day and your week.

4. Go deeper with outreach and marketing. This is an important time for you to connect with past clients and active prospects. You want to remain top of mind and let them know you are still here, and that you care. It would be a great time to send a hand-written, personal note communicating good wishes and expressing concern. Been putting off those geographic farm mailings, just listed/just sold postcards or flyers? Now is the time to get caught up. Dig out all those old open house leads you have in a folder somewhere and follow up. You know they are probably home now!

5. Keep in mind that people are scrolling more. Social media is super important right now! You want to be where people are spending their time. Make sure you are time-blocking spots in your calendar for building your presence on Facebook, Instagram, and others. Look at your profiles and make sure they are up-to-date. Post positive and helpful items, and stay away from negative or politically charged ones. Now’s a great time to learn a new tech tool. Post videos on YouTube. It will help your sellers greatly if you can handle home showings virtually, because you’ve posted a great video or virtual tour.

6. Beef up your business planning. Do you have written goals? If not, now is your chance to create a business plan. Yes, it’s difficult now to project what’s to come, but you still have a sense of what you need your income to be. Now’s the time to review and take stock: What were my numbers from 2019 – average sales price, average days on market, seller-to-buyer ratios, etc.? Knowing where you’ve been will help you determine where you can go. If you don’t track and measure, how will you know what aspects of your business need improvement?

If you haven’t already, learn QuickBooks and start a monthly profit and loss statement (it’s not too difficult to backtrack to January and get that accomplished for 2020). When you do your taxes next year, you will be so glad you got that done. Organize and clean your home office. You may be surprised how much more efficient you feel with a clean and tidy desk/office space.

7. Stay connected. Be sure to check in with your associates, the office staff, and your affiliated service people. Set up a quick virtual coffee or lunch – see how everyone else is doing and, perhaps, do a bit of brainstorming and exchange ideas. It’s always great to learn from others, as well as continue these important relationships. Everyone is reeling right now. Don’t do it alone.

Roxanne Kazda is a motivational real estate productivity coach based in the Chicago area. She was a licensed real estate agent for more than 20 years in Massachusetts and Illinois followed by four years as team leader and business strategist for Keller Williams Realty.

Source: National Association of Realtors®, Realtor Magazine, Roxanne Kazda

© 2020 Florida Realtors®

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Little Change in Long-Term Mortgage Rates: 30-year at 3.33%

Home-loan rates have been hitting all-time lows, but mortgage buyer Freddie Mac says there’s room for them to move lower. The average 15-year declined this week.

WASHINGTON (AP) — U.S. long-term mortgage rates were stable to slightly lower this week after two weeks of declines amid deepening anxiety over the severe damage to the economy from the coronavirus pandemic.

Home-loan rates have been hitting all-time lows, and mortgage buyer Freddie Mac says there’s room for them to move lower. Freddie Mac reported Thursday that the average rate on the benchmark 30-year loan was unchanged this week at 3.33%. A year ago the rate stood at 4.12%.

The average rate on the 15-year fixed-rate mortgage declined this week to 2.77% from 2.82% last week.

Demand from prospective homebuyers has weakened in response to economic concerns, and the housing market has been upended by the pandemic just as it was entering the busy spring season.

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Hurry Then Wait: Why Has Small Business Relief Lagged?

Small businesses need money fast to ride out a short virus-induced recession, but they’re not getting available funds. The problem is both technical and bureaucratic.

NEW YORK (AP) – Speed is of the essence if a federal relief program for small businesses is going to be effective in combating the damage wrought by the coronavirus lockdowns. Yet, days into the program, many Main Street businesses are still waiting for the cash infusion necessary to stay alive. Others say they haven’t even been able to apply for loans under what’s called the Paycheck Protection Program.

The problems range from the technical to the bureaucratic, although the Small Business Administration says it has corrected those on its end.

Here are some questions and answers about the snags the program faces, and what options owners have:

Florida Realtors is monitoring everything regarding how the COVID-19 pandemic is affecting the real estate industry and Realtors and sharing it here.

What are small businesses saying?

Small business owners essentially say they’re in limbo. While a few have gotten funds, many whose loan applications were accepted by their banks are unsure about when they’ll see the money. Some were told they’d hear something in three to five business days. Some businesses can afford to wait, but many others say they’ll soon go out of business. Companies with no more than 500 employees at each physical location can apply for a loan of up to $10 million.

Then there are the businesses who the banks turned away. Many sought to apply through their own banks, only to discover they needed a checking account, a credit card and a previous loan to be considered. Some banks, such as JPMorgan Chase and Citigroup, haven’t been taking applications.

When owners turned to other banks, many of those institutions would only take applications from established customers. Frustrated, some owners have turned to Congress for help.

Chris Phoenix said he was feeling anxious as he waited for Citibank to start accepting applications.

“Luckily we have a little bit of fuel in the tank and we’ve been able to negotiate with our landlords and utility companies but we need to see some movement soon,” said Phoenix, CEO of Phoenix, a New York-based digital marketing company.

What about the banks?

The banks are taking criticism from all sides: small business owners, the government and members of Congress. But although the government is promising to guarantee the loans, the banks want to be absolutely certain they don’t end up with bad loans on their books.

Bankers have said they are prioritizing existing customers because they don’t require additional paperwork tied to verifying the customer’s identity. Banking is a relationship business; bankers often focus on those who are already customers and who have a solid track record.

Banks say they have been approving hundreds of thousands of applications but those have been getting hung up at the SBA, some due to technical problems. Bankers also say there is a legal issue. Each loan requires a promissory note – basically a legal contract – and it was unclear until Wednesday afternoon whether banks should use their own contracts or ones drafted by the SBA since PPP is a government program. The banks don’t want to be on the hook for these loans due to a paperwork error.

Some banks, such as Virginia-based Atlantic Union Bank, took the risk of using their own notes to fund $50 million in loans so far. Others are manually processing loans.

Was the Small Business Administration (SBA) ready?

The Treasury Department promised at the program’s launch that money could go to businesses the same day their application was approved. But although the SBA says it has received more than 381,000 applications valued at $100 billion as of Wednesday afternoon, little money is flowing to owners’ bank accounts.

Earlier this week, the SBA ran into a technological problem. The agency uses a system known as E-Tran to approve loans. But the system has been inundated with applications and stopped working on Monday; the SBA says it has since been up and running.

Banks were submitting in a single day the number of applications they typically do in six months. And the SBA system normally approves applications in a matter of weeks, not days.

The hang-ups have created friction. A video surfaced Wednesday on The Washington Post’s website of a local SBA official saying the big banks that accepted billions of dollars in bailout money during the 2008 financial crisis “are the same ones saying the documentation isn’t clear enough for them” now.

Joseph Amato, director of the SBA’s Nevada district office, who also said banks don’t give “a hoot about small business” added, “that’s my editorializing.”

The SBA’s loan processing system stopped working Monday, making it impossible for loans to be approved and funds distributed, according to community bankers.

What are members of Congress saying?

Congresswoman Doris Matsui, D-CA, sent a letter to banks and other financial institutions in Sacramento, saying banks were too restrictive with their lending criteria. “In the middle of a public health crisis, this is simply unacceptable,” she wrote.

Sen. Marco Rubio of Florida has been pushing for clarification of some PPP rules. Rubio, the head of the Senate’s small business committee, also called for the Federal Reserve to allow Wells Fargo to accept more loans after stopping at $10 billion. The Fed did so Wednesday. Wells’ lending capacity has been limited because it’s under federal oversight.

Do owners have alternatives?

They may have to shop around. Some smaller banks, like regional and community banks and credit unions, may be more accommodating than larger banks. Another possibility is an online loan marketplace such as Lendio and Fundera that have multiple banks linked into their system. These companies operate like travel websites that allow users to find deals that are a good fit for them.

Is other government aid available for small businesses?

The SBA is making what are called economic injury disaster loans available to businesses, but there have also been complaints about these loans, which require much more paperwork and typically take weeks to process. The government has provided for $10,000 grants under the disaster loan program and promised the money would be available within a few days. However, owners either say they’re waiting for the money or haven’t heard about loan approvals.

Owners who apply for paycheck protection loans can also get disaster loans but they cannot use disaster loan money for payroll, mortgage interest, rent or utility expenses.

Copyright 2020 The Associated Press Joyce M. Rosenberg and Ken Sweet, AP business writers. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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Learn to Do Business Remotely – It May Be the Real ‘New Norm’

The move to no-contact lenders has been slow and sure, but self-isolation may jumpstart changes as more consumers get comfortable doing things completely online.

CHICAGO – For homebuyers or homeowners that still need to close on a loan, real estate pros can offer them some extra assurance: Mortgages are now being processed without any physical contact. That means consumers can still take advantage of the lowest mortgage rates in history without fears of breaking social distancing rules during the COVID-19 pandemic.

Details of this trend were presented at a Virtual Education Expo training session sponsored by Coldwell Banker on Tuesday.

“With mortgage rates at historical lows, consumers can save money on the purchase of a home or they can refinance to put more money in their pockets, possibly when they need it most,” said Tim Foley, executive vice president of operations for Coldwell Banker, during the session on mortgages. “The ability to refinance and complete a purchase with a mortgage with no human contact may soothe some fears.”

“It’s a game changer and the new norm,” added session speaker Victor Ciardelli, president and CEO of Guaranteed Rate Affinity. “You can walk through the process in a new way.”

Most lenders have moved to digital or hybrid models, including virtual appraisals to complete transactions.

Source: National Association of Realtors® (NAR), Melissa Dittmann Tracey

© 2020 Florida Realtors®

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