Due to the residual financial impacts of the COVID-19 crisis, many rental tenants and homeowners across the city will struggle to make their rental or mortgage payments in the coming months. While New York has implemented a moratorium on rental evictions for 90 days and banks will waive mortgage payments and suspend foreclosures for eligible homeowners during a similar period, one must wonder what will happen long-term, especially when the pandemic promises to leave millions of New Yorkers out of work or underemployed. Governor Cuomo and Mayor de Blasio have suggested that the aforementioned offers could be extended beyond 90 days depending on how the fight against the contagion plays out.
Owing to the countless unknowns and resulting stress experienced by tenants/homeowners during this time, we turned to Jarred Kessler, CEO of EasyKnock, to obtain some advice for residents concerned about making their home payments. Jarred runs an innovative proptech platform that works with American homeowners who are seeking alternative financing options due to COVID-19 or any other financial implications life throws at us.
In a nutshell, the New York City-based company offers a commercialized residential sale-leaseback program, allowing homeowners to tap into the value of their home/apartment without moving. Homeowners sell their property to EasyKnock and can opt to stay in their homes as renters. The former owner can continue to live at the property while paying monthly rent. The resident can repurchase the home for a price that has been previously agreed upon, or move at any time.
How should a tenant negotiate with their landlord?
If a renter is struggling to pay rent, they should explain their situation to the landlord who will likely ask them to fill out a tenant hardship application. It's incumbent on the landlord to work with the tenant.
Landlords should not be evicting, they should be working with people. This is a tough time. Residents should not be apologizing or feeling that they have done something wrong. No one saw this coming. The world has hit the pause button, and all respectable landlords should be working with their tenants. This is a good time to see how companies will act. People are not going to forget.
Here at EasyKnock, we offer all our renters to fill out a hardship application. We allow our tenants to tell us we're going through a rough time. That being said, tenants should not use this as an opportunity to not pay rent. If you have the money, pay it. Why defer something you will likely have to pay for eventually?
Landlords should not be evicting, they should be working with people. This is a tough time. Residents should not be apologizing or feeling that they have done something wrong. No one saw this coming. The world has hit the pause button, and all respectable landlords should be working with their tenants. This is a good time to see how companies will act. People are not going to forget.
Here at EasyKnock, we offer all our renters to fill out a hardship application. We allow our tenants to tell us we're going through a rough time. That being said, tenants should not use this as an opportunity to not pay rent. If you have the money, pay it. Why defer something you will likely have to pay for eventually?
What's your advice for homeowners who cannot make mortgage payments?
I recommend contacting the lender and asking for a forbearance. Many states are also suspending mortgage payments for a certain period. I strongly encourage people to prioritize food, utilities, rather than mortgage payments. The various levels of government have signaled that they will be providing various forms of help to all Americans affected by the pandemic.
Most banks do not want to have a reputation for foreclosing during a crisis, so a call with the bank is a good first step. Second, people need to prioritize needs like food and health over mortgage payments. I would advise those who can to pay, and those who can't, to create a list of priorities. This is the rainy day people save for, but we don't know how long it will last. Do what you can to care for your family and medical needs before you pay a mortgage.
Most banks do not want to have a reputation for foreclosing during a crisis, so a call with the bank is a good first step. Second, people need to prioritize needs like food and health over mortgage payments. I would advise those who can to pay, and those who can't, to create a list of priorities. This is the rainy day people save for, but we don't know how long it will last. Do what you can to care for your family and medical needs before you pay a mortgage.
Model rental apartment at The Pierrepont in Brooklyn Heights (Credit: Jonathan Rose Companies)
At what point do homeowners risk foreclosures?
I don't think you're going to see any foreclosures until July in any state. The court system is backed up or even closed in many areas. No one will be foreclosed on for at least six months. For now, a homeowner should be transparent and communicating with their lender. During these unprecedented times, people need to be humans beings instead of capitalists.
Anything else you can tell New York City homeowners about EasyKnock?
We typically do not buy homes valued over $1 million, and we don't handle co-ops and their stringent boards.
If people are looking for a solution to bridge liquidity, I think EasyKnock is a great solution. We approach homeownership as something that hasn't been innovative in recent years. We've only been buying homes for a year and a half, and now have $150 million in assets under our belt. The benefit for a struggling homeowner is that they can remain in their home, which is often the most cherished and valuable asset most of us will ever know. Another benefit is knowing they could buy their home back with the cash we give you. Therefore, we turn homeownership into a flexible experience.
If people are looking for a solution to bridge liquidity, I think EasyKnock is a great solution. We approach homeownership as something that hasn't been innovative in recent years. We've only been buying homes for a year and a half, and now have $150 million in assets under our belt. The benefit for a struggling homeowner is that they can remain in their home, which is often the most cherished and valuable asset most of us will ever know. Another benefit is knowing they could buy their home back with the cash we give you. Therefore, we turn homeownership into a flexible experience.
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