So I’m going to move on to number six. I’m sorry I’m car, but I’m going to throw a wrench in this. I’m going to go to the next topic, which is Shana‘s question. All rght, it says buy and sell options, but I’m going to talk about right now as my personal thoughts on forbearance, what we may see in the future as a result of it. All right. So now we’re in future speculate speculation mode.
I’ll answer your question a second. Making future speculation mode. There are a lot of people in this this economy right now has been described as a shape economy, right? So some people are gaining wealth faster than they’ve ever gained. We’re seeing that a lot every single day. It’s like Jeff Bezos is richer than ever and, you know, Elon Musk is richer.
Forbearance
And then there’s a large portion of the the economy that is struggling. Right. Like, it’s not a good thing. And that’s why the stimulus checks are so popular. And with that, with the with the K shape economy, there are a lot of individuals and families that are hurting that loss. Employment lost, jobs had to burn through savings that took forbearance.
So what they did is they called the bank and they said, I cannot afford to make my mortgage loan right now. And the bank gave him one or two options. Option one is we’ll let you live there for a while for barrier, your payment for three months and then at the end of three months, you owe it all. So if my payments a thousand dollars a month, one thousand, two thousand, three thousand a month for I owe four thousand dollars to the bank, if I don’t make that payment, I’m delinquent.
Penalties start coming up and I move towards the foreclosure process. The other option is some banks allow them to add it to the end of the loan. So it’s almost like a negative amortizing loan. My loan amounts going up also kind of a bad thing, but it might make it easier for the average person to to work through that process.
So a lot of the people that we listen to as we move through this covid process, we believe that a lot of the forbearances that are coming due will start coming due January, February, March of twenty twenty one. With that being said. As people try to make that large lump lump sum payment, one of two things are going to happen. Number one is they can’t do it. And so they realize that, you know what, I need to sell my house right now so that I don’t lose all this equity that I’ve gained over the last five years.
That’s a hard decision that you have to really swallow your pride, swallow your ego and realize I need a cap dramatically. That’s great for you guys is listing agents because that’s more homes that could potentially be on the market and clients that really do need to sell. It’s in their best interest. Option two is I’m stubborn. I don’t want I’m not selling. I’ve lived here for 10 years. I’m not selling. I can’t do it now. I’m late.
And now late fees start getting assessed and late fees get assessed on the amount due. So the full four thousand instead of just one thousand and then they’re delinquent. And then April, May, June, they start seeing pre foreclosure. Foreclosure. OK, so two things that we believe are going to happen and start seeing more homes coming on the market and potentially more foreclosures coming on the market. So is it a good thing? It’s debatable. I mean, there are a lot of people on the other end of that that are hurting and struggling, and that’s never a good thing.
But that does present an opportunity for people in real estate, both buyers and investors, listing agents and buyers, agents, as we can get some more inventory on the market. I know that’s a big problem right now. I hope I answer that question short of gonna answer Megan’s question. Best interest rate that we’ve seen on a 30 year fixed was in mid-December, and that was about two point twenty five.
So rates have ticked up a little bit. Following rates is very challenging because rates, mortgage interest rates are generally based on the bond market, which is based on an investor’s confidence in our government and our system of life. Right. So there’s a website you go to Fannie Mae dot gov. They have a great tool. They update the average interest rates daily.
So your clients and kind of go there and look at it as opposed to trying to go online and put in the information and get in this Legian system on all these random things. So Martha Johnson asked Brennan, do you finance classes that agents can attend via Zoome or otherwise? I’m not quite sure what finance classes are, but I am one hundred percent open to doing Zoome classes, doing physical classes face to face. I’m very passionate about educating and empowering people.
I know Lindsey as well. She’s a financial adviser. She does a phenomenal, phenomenal job of communicating to people on complex financial decisions, long term decisions. A lot of times right now people are struggling because they’re very everything is so like there’s micro dramas in the news and the media every 30 minutes. And so people are so tied into like a 30 minute cycle.
So trying to, like, step back and kind of look at the big picture, you know, what’s my life look like in 10 years, 20 or 30 years. So I’m very passionate about that from the real estate perspective, because buying a house, most people do 30 year financing.
So to answer your question, Martha, yes, I would love to. I’ll drop my information in here. You can reach out to me, text, email, call me, and I’d be more than happy to set up any time to do that. So that’s great. Any other questions? Before I let you guys go, I want to leave with some some some thoughts.
