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Landlords, property managers worry properties will be at risk of foreclosure

Posted at 5:10 PM, Oct 15, 2020
and last updated 2020-10-15 18:47:29-04

INDIANAPOLIS — With thousands of people behind on rent because of the COVID-19 pandemic, landlords and property managers are now also behind on mortgages, putting the very homes renters live in at risk of foreclosure.

“At the end of the day, we’re going to get back into the ’08 housing debacle,” said Chris Schulhof, owner of RE/MAX Reality Services. "I mean it was tough."

The owner of RE/MAX Realty Services, which manages about 50 properties for homeowners, says we could soon find ourselves in a housing crisis.

“They keep coming to us saying you’ve got to get that rent collected and we are going back to them saying because of the moratorium, our hands are tied,” Schulhof said.

Schulhof says since the Center for Disease Control and Prevention issued a national moratorium on evictions beginning Sept. 4, they’re unable to do anything, while some tenants have just stopped paying rent.

The landlord or homeowner is now out the cash they’d normally collect to pay for their mortgage.

“Our hands are tied,” he says. “So how is that rent going to be paid?”

Schulhof says he’s compassionate with renters and works with them.

“We have had, for example, a tenant call me and say 'Look I’m in the janitorial arena taking care of churches. And unfortunately, the churches aren’t having congregations so therefore the churches are laying us off,'" Schulhof said. "In that case, I actually reached out within the contacts of my sphere and I found her opportunities. We do have one tenant who has not lost their job, but took advantage of the system or is taking advantage of the system and stopped paying in February.”

They’re now taking that tenant to court next month.

Other landlords we’ve seen are trying to evict tenants not paying rent through what’s called a holdover eviction.

“There is a loophole, if you will, that’s the holdover moratorium,” Schulhof said.

That’s where someone’s lease has expired and the CDC moratorium no longer protects them.

Schulhof says he has not looked into doing that, however.

As the federal protection expires come January, Schulhof fears, “all of a sudden we are going to have foreclosures out there. And that’s what I’m concerned about.”

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