A report from Buzzfeed. “Buying a home is not for the faint of heart. 21: ‘Do your research on the neighborhood and street. Try to go to the home you plan on buying at different times during the day, and even at night if you can. You can do as many renovations as you want on the house itself, but if you hate the neighborhood, you still won’t be happy. I wish we would’ve done that before we bought our current home — now we can’t wait to get out.’”
“22: ‘Don’t blindly trust the home inspection. If your budget allows, hire people that are specifically-trained to inspect various elements of your home. Have someone come to specifically check out the HVAC system, electrical work, and plumbing — especially sewer lines or septic systems. Our inspection said things were ‘old, but OK.’ Two months and $20K later, we beg to differ.’”
From DS News. “Despite the industry’s best efforts, not every borrower can be helped. An increasing percentage of the remaining forbearances are ending with borrowers in default, and with no viable loss mitigation option. Many of those borrowers are now filing a Chapter 13 bankruptcy to save their homes. In essence, bankruptcy is a type of loss mitigation of last resort. Unfortunately, Chapter 13 bankruptcy does not play well with forbearance.”
“Chapter 13 requires regular payments, and yet forbearance allows the borrower to cease making payments during the forbearance term. In an attempt to ensure that borrowers could take advantage of both forbearance and a Chapter 13 bankruptcy, Congress added some temporary bankruptcy provisions. In some Circuits, even where a servicer objects to putting the post-petition arrearages in the plan, courts regularly resolve the motion for relief from stay by ordering that those defaulted payments be added to the Chapter 13 plan. In short, Congress’ belief that a special mechanism was required to place missed post-petition payments into a plan seems misplaced.”
“The ability to file a CARES Forbearance Claim will end on December 27, 2021, as will the right of a creditor to move to modify a plan to include the missed forbearance payments. And as with anything bankruptcy related, check with your local bankruptcy counsel on the best approach to resolve defaulted payments that occur during the forbearance term. Local rules and custom may argue for strikingly different approaches.”
The Real Deal on New York. “It’s been a wild ride for Brooklyn landlord Chaskiel Strulovitch. The beleaguered landlord put his 31-unit rental portfolio into Chapter 11 two years ago in Westchester County to thwart foreclosure by hardball lender Maverick Real Estate Partners. Strulovitch and his partners were also accused by investors of defrauding them ‘in the style of Bernie Madoff.’ Strulovitch’s legal team denied the allegations.”
“Now Strulovitch has secured exit financing to take a majority of his portfolio out of bankruptcy. Strulovitch recently closed on a $13.9 million, one-year refinancing from New York-based Maguire Capital for eight buildings in the portfolio, according to a person close to the situation. Although the loan from Marvin Azrak-led Maguire gets eight properties out of bankruptcy, rescue financing does not come cheap.”
“The loan, which covers 36 residential units and one retail unit, has an interest rate of LIBOR plus 10.42 percent with a floor of 10.50 percent per year. On top of that is a 2 percent origination fee and a 1 percent exit fee, according to a court filing in October. The clock is now ticking for Strulovitch to find a lender to replace that loan when it expires.”
“The remaining 13 buildings are headed to auction this week, according to bankruptcy court filings in New York’s Southern District.”
The Los Angeles Times in California. “On top of a ridge in Beverly Crest, a 120-acre estate owned by late Microsoft Corp. co-founder Paul Allen, has sold for $65 million — a deep discount from its original price tag of $150 million.”
From The Sun in the UK. “Ryan Giggs has sold his old house for £2.7million — after being forced to slash the price by £800,000 after it failed to sell for more than two years. He used to live in the luxury family home in Worsley, Gtr Manchester, with his ex-wife Stacey and their two children before the couple divorced in 2017.”
From Business Insider. “The housing market is showing signs of softening across Australia as buyers in Sydney and Melbourne grapple with an affordability crunch. ‘A surge in freshly advertised listings through December has been a key factor in taking some heat out of the Melbourne and Sydney housing markets, along with some demand headwinds caused by significant affordability constraints and negative interstate migration,’ said CoreLogic research director Tim Lawless.”
From Bloomberg. “The wrecking ball headed for 39 apartment blocks on a tropical island at the southern tip of China poses the latest threat for China Evergrande Group as local governments race to reclaim land ahead of a looming restructuring of the embattled developer. The government of Danzhou, a city in the province of Hainan, has asked Evergrande to tear down what it says are illegal buildings within 10 days. The order was signed Dec. 30, meaning the company could start demolition work on the near-complete condos by Jan. 9. Evergrande has appealed the order, according to a media report.”
“The Hainan edict is among the most extreme in a spate of government actions to seize Evergande’s property and land holdings. As more officials across China rush to take control of Evergrande assets before a potential court-led restructuring that would constrain their power, it’s making it more difficult for creditors to gauge the true state of the developer’s financial health. Understanding the value of Evergrande’s land and unfinished projects is key to determining whether Evergrande bonds are worth buying at prices of about 15 cents on the dollar.”
“‘Evergrande may have lost the last chance to sell its land bank for cash,’ said Bloomberg Intelligence analyst Patrick Wong.