When bills can't get paid
This is a continuation of my last entry. Speaking of what is going on in our world right now and how people will handle it if we get to a point like Italy, Europe or China.
One thing that JP and I have on our goal list is to one day have rental properties. We have not yet gone that route because the only way I will do it is if I pay cash for the rental property. I have spoken with colleagues, friends and family over this, and I will not change my mind and now that our world is taking a turn to where people may be out of work for a while, I can share my view with you in a way that you may better understand it now.
When you overextend yourself to purchase more properties, you become more desperate when your properties are not filling up with rentals. Maybe you decide to take a chance on a less desirable tenant or feel the need to lower your rent a bit to fill your rental quicker. Not all of those that have rental properties are overextended, but we will surely see what will happen in the next month or so when those rental properties have mortgages and they are filled with renters that are out of work temporarily and have no money to pay their bills. If the renters can't pay the bills and now the owner has his own mortgage to pay plus he has to pay his rental property mortgage without the rental income, things could get ugly. What if that owner has 5 rental properties and what if most of them are out of work? What happens then? The owner will surely become more stressed out and will have to talk with the banks about the situation. But imagine if that same owner had those rental properties all paid off, he would be able to give more grace to the renters who are unable to work, he would not be as stressed out and would be able to be more understanding. Before this pandemic that same owner would be able to wait for a more desirable tenant and would not have to lower their rental prices if they already felt they were reasonable. You also make more money when you do this since your money isn't going to interest on your mortgage.
I feel the same way about rental properties as I do about second properties, like a vacation home. If you think you can afford a vacation home, then you should be able to pay cash for that. If this pandemic continues to go the way it is going, what happens when you are out of work with no income coming in and now you can't pay your own mortgage or your vacation home mortgage?
The House has now passed Covid-19 Aid Relief that should help US Citizens, but I cannot find anything about the logistics of that or what the next steps are for the relief aid. Please comment if you are better with politics and have a better understanding of what this relief will actually provide and how those people will receive those funds.
Do you own rental properties or have a vacation home? How do you feel right now? You good? Like, share, comment and subscribe.
One thing that JP and I have on our goal list is to one day have rental properties. We have not yet gone that route because the only way I will do it is if I pay cash for the rental property. I have spoken with colleagues, friends and family over this, and I will not change my mind and now that our world is taking a turn to where people may be out of work for a while, I can share my view with you in a way that you may better understand it now.
When you overextend yourself to purchase more properties, you become more desperate when your properties are not filling up with rentals. Maybe you decide to take a chance on a less desirable tenant or feel the need to lower your rent a bit to fill your rental quicker. Not all of those that have rental properties are overextended, but we will surely see what will happen in the next month or so when those rental properties have mortgages and they are filled with renters that are out of work temporarily and have no money to pay their bills. If the renters can't pay the bills and now the owner has his own mortgage to pay plus he has to pay his rental property mortgage without the rental income, things could get ugly. What if that owner has 5 rental properties and what if most of them are out of work? What happens then? The owner will surely become more stressed out and will have to talk with the banks about the situation. But imagine if that same owner had those rental properties all paid off, he would be able to give more grace to the renters who are unable to work, he would not be as stressed out and would be able to be more understanding. Before this pandemic that same owner would be able to wait for a more desirable tenant and would not have to lower their rental prices if they already felt they were reasonable. You also make more money when you do this since your money isn't going to interest on your mortgage.
I feel the same way about rental properties as I do about second properties, like a vacation home. If you think you can afford a vacation home, then you should be able to pay cash for that. If this pandemic continues to go the way it is going, what happens when you are out of work with no income coming in and now you can't pay your own mortgage or your vacation home mortgage?
The House has now passed Covid-19 Aid Relief that should help US Citizens, but I cannot find anything about the logistics of that or what the next steps are for the relief aid. Please comment if you are better with politics and have a better understanding of what this relief will actually provide and how those people will receive those funds.
Do you own rental properties or have a vacation home? How do you feel right now? You good? Like, share, comment and subscribe.
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