Forbearance of Foreclosure? How to Keep Your Credit and Homeownership Intact

The following is a guest post by Eric Lindeen, of Anna Buys Houses.

The second quarter of 2020 marked the highest U.S. mortgage delinquency rate (reported as 60-days past due) since 1979. Amidst the chaos of the pandemic, federal and state governments have made efforts to protect against the financial strain U.S. consumers are enduring—including mortgage payment forbearance of foreclosure. 

What Is a Forbearance?

Forbearance is the postponement of mortgage payments, or the lowering of monthly payments for a specified time period; it’s not loan forgiveness. Repayment terms are negotiated between the borrower and lender. Mortgage forbearance is one tool to help protect homeowners from foreclosure due to temporary hardships, such as a job loss, natural disaster, or pandemic. Some homeowners may opt for strategic forbearance, meaning they proactively enter a forbearance agreement just in case they lose their ability to make their mortgage payments.

As of October 25, data from the Mortgage Bankers Association (MBA) reports that approximately 2.9 million U.S. homeowners are currently in forbearance plans. That number represents 5.83% of servicers’ portfolio volume. MBA data also shows that nearly 25% of all homeowners in forbearance plans have continued to make their monthly payment (perhaps an indicator of the use of strategic forbearance).

How Do Forbearance Plans Work?

Mortgage payment forbearance programs have come at a time when many Americans are losing their livelihood and others fear the potential fallout from the health and economic crisis. Not all forbearance plans are created equal. Therefore, it’s critical to understand how different plans are structured to protect your financial health and credit. 

The Coronavirus Aid, Relief and Economic Security (CARES) Act is one measure enacted to provide relief to consumers facing hardships due to the impacts of the coronavirus. One provision of the Act allows mortgage payment forbearance and provides other protections for homeowners with federally or Government Sponsored Enterprise (GSE) backed or funded (FHA, VA, USDA, Fannie Mae, Freddie Mac) mortgage loans. 

If you have a federally or GSE-backed mortgage, no documentation is required to request forbearance, other than an assertion that you are facing a pandemic-related hardship. Borrowers are entitled to an initial forbearance period of up to 180 days. If necessary, an extension of an additional 180 days may be requested. Federally backed mortgages are protected against foreclosure through December 31, 2020. 

Recently, the foreclosure moratorium was extended yet  again to at least March 31, 2021 for GSE-backed loans (Fannie Mae and Freddie Mac). Be sure you understand who owns your loan and the terms of your loan as these deadlines approach. Extensions are likely to continue to help borrowers keep their homes and lenders navigate the constant uncertainty that is 2020.

The CARES Act amended the Fair Credit Reporting Act (FCRA) with a provision that when a lender agrees to forbear an account of a consumer impacted by the pandemic, the consumer complies with the terms of the forbearance. Then, the mortgage issuer must report that account as current to credit reporting agencies.

How Your Credit Factors into Forbearance

On paper, knowing that your credit won’t be affected by forbearance seems like a good deal. There’s an important distinction here. Your loan doesn’t need to be current to qualify for forbearance under the CARES Act. However, any delinquencies on your account prior to entering a forbearance plan will impact your credit report. Make sure that your loan is current, and being reported as current to the credit bureaus, before you agree to a forbearance of foreclosure.

What about Private Mortgages?

Around 30% of single-family mortgages are privately owned. Many private banks and loan servicers have voluntarily implemented relief measures that don’t fall under the same protections of the CARES Act. Terms vary by institution and state of residence. And relief plans may not be structured in the same manner as federally-backed and funded loans. 

For example, borrowers with private loans may be required to pay back all missed payments in a lump sum as soon as the forbearance period ends. Lump sum payments are not required for GSE-backed loans. Additionally, if modifications are made to a privately funded loan, the new terms could impact your credit score depending upon how the lender reports the status of your loan to the credit bureaus.

The good news is that the three major credit bureaus (i.e., Equifax, Experian, and TransUnion) are providing free weekly online credit reports through April 2021. Be sure to check these reports to ensure that the new terms of your loan are being reported as “paying as agreed” and not reported as late. Credit.com also has resources to help check and manage your credit.

It’s also important to understand the terms of your loan. Some homeowners who recently refinanced were asked to sign a form that was quickly described as “new COVID paperwork.” The fine print stated that their new loan was not eligible for forbearance relief measures. 

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Mortgage payment forbearance is one tool that can protect homeowners from defaulting on their loan, damaging their credit, and worst of all, losing their home to foreclosure. Key takeaways include, knowing who owns your loan, who services your loan, and what type of protections are available to provide relief if the current economic crisis is impacting you or you fear that it might. 

There are proactive steps to protect against foreclosure and determine the right path for your personal situation.

Source: credit.com

Depleted savings, ruined credit: What happens when all the rent comes due?

Millions of Americans unable to pay their rent during the pandemic face a snowballing financial burden that threatens to deplete their savings, ruin their credit and drive them from their homes.

A patchwork of government action is protecting many of the most financially strapped tenants for now. But it could take these renters — especially low-income ones — years to recover, even as the rest of the economy begins to rebound.

“Even if they say we can pay [missed rent] back in two or three years — that’s money we don’t have,” said Kelly Wise, a 32-year-old resident of L.A.’s Westlake neighborhood. After losing jobs selling merchandise at concerts and cutting fabric for Hollywood sets, she is more than $10,000 behind on rent.

Debt threatens to hit renters in several ways. Some have kept up with their rent payments but have turned to credit cards and high-interest loans. Others owe mounting bills directly to landlords that must be paid back when eviction moratoriums expire, opening the possibility — if the debt goes unpaid — for evictions and court orders for back rent. That could erode credit scores and lead to wage garnishments and more.

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“We are setting up millions of people for long-term harm and a cycle of economic and housing instability,” said Emily Benfer, chair of the American Bar Assn.’s COVID-19 Task Force Committee on eviction.

Renters across the nation are dipping into 401(k)s, taking on higher-interest debt, and scrambling for risky, essential-worker jobs to pay the rent. Research from Moody’s Analytics and the Urban Institute estimates 9.4 million U.S. renter households owed an average of $5,586 in back rent, utilities and related late fees as of January, for a total burden of $52.6 billion.

Other estimates show a smaller but still significant amount of rent debt. The full scope of the problem isn’t clear because the situation is fluid, and estimates so far are based on surveys and models, rather than hard data.

“[Bad] debt affects your credit score, and credit scores affect everything in your life,” said Yuval Yossefy, a manager at the Legal Aid Foundation of Los Angeles, a nonprofit law firm.

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Federal, state and local officials are grappling with how best to help people stay afloat — including keeping them housed — amid job losses, slashed incomes and pervasive disease. A second year of the COVID-19 pandemic has brought little reprieve, with new variants of the coronavirus threatening to accelerate the virus’ spread and cause longer disruptions to the economy and everyday life.

States are planning to get federal aid funds, which have begun to flow, into the hands of landlords to reduce the debt load on tenants. California, where median rent is 50% higher than in the nation at large, has passed what state leaders characterize as the strongest statewide measures to address the crisis, providing a potential model for how states could distribute rent funds.

The California measures, approved by the Legislature last week, extend a statewide moratorium on evictions for people with pandemic hardships through June. Significantly, they bar landlords from using rent debt accrued between March 2020 and June of this year to deny future housing — a nod to fears that unpaid rent may affect people’s housing for years to come.

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And to protect the most vulnerable, they establish a program that uses federal stimulus money to encourage landlords to forgive debt accrued by low-income tenants over the span of a year: April 2020 to March of this year.

Whether California landlords opt in, exactly how the program will be implemented, and if it will make a significant difference for those most in debt are still open questions. Nonprofit groups that work with low-income renters say the measures could be hard to enforce and, in terms of altogether forgiving some debt, rely precariously on optional landlord participation.

Eviction and debt can make it difficult to find new housing, take out loans, get some types of jobs or budget for necessities like food. In California, where rent was unaffordable for most tenants to begin with, the debt pile-on compounds a long-brewing problem.

Illustration: a man and a woman weighed down by balls and chains representing their debt.

Eviction and debt can make it difficult to find new housing, take out loans and get some types of jobs.

(Nicole Vas / Los Angeles Times)

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“A family that makes less than $30,000 a year, they are going to be on the verge of homelessness for the next 10 to 15 years because of this huge debt,” said Ana Grande, associate executive director of the nonprofit Bresee Foundation in Los Angeles, which provides assistance to low-income families.

Making matters worse: Studies show those with debt are least likely to afford it — even if they regain their old incomes. Compared with all L.A. County renters, households that earned less than $25,000 in 2019 were more than twice as likely as all renters to not pay their rent during the pandemic, according to a joint USC-UCLA survey. Households that earned between $25,000 and $50,000 were the second most common group to report not paying.

Nonpayment was also highest among Latino and Black Americans who, compared with white Americans, have been hit harder by the health and economic effects of the virus. They are also less likely to have family who can lend financial help given the country’s long-running racial wealth gap.

An eviction ‘changes the trajectory of a life’

Across the country, a series of problems can unfurl from a single eviction.

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Some landlords refuse to take tenants with an eviction on their record, while those who do are likely to charge more, fail to keep up their properties and have units located in dangerous neighborhoods, according to housing attorneys and other experts.

Studies have found people who are evicted are more likely to experience depression and to die of any cause. People move far from their support networks, or miss work while trying to find new housing and lose their jobs. Kids fall behind at school.

“An eviction is not a single event in a person’s life,” Benfer said. “It actually changes the trajectory of a life, because it has such catastrophic implications for fiscal and mental health.”

In a pandemic, experts say an eviction is particularly dangerous, leading a person to double up with friends and family in crowded housing situations that accelerate the virus’ spread.

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Absent an eviction on a person’s record, debt and poor credit scores can impede the ability to find housing, often leaving people to live in lower-quality conditions, said Ariel Nelson, an attorney with the National Consumer Law Center.

Poor credit scores also limit the ability to take out car, home and other loans at reasonable interest rates, putting homeownership further out of reach.

Past-due debts on a credit report may lead some employers to turn down a candidate for jobs that involve handling money, such as a bank teller or a cashier at a restaurant, said Bruce McClary, spokesperson for the National Foundation for Credit Counseling.

If debts continue to go unpaid, creditors can garnish wages, though restrictions exist on how much disposable income creditors can take.

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To preempt this, people might dip into savings or cut back on food. They may take out the only loans available to them: sky-high-interest products that critics say are nearly impossible to pay back.

Some tenants have already headed down the debt spiral. The USC-UCLA study found 8.5% of surveyed tenants paid some rent with a credit card in July, compared with 3% normally. Nearly 8% used a payday or other emergency loan.

An out-of-work graduate student in Lakewood told The Times she requested and got a budget increase for her student loan to pay rent, adding to her total student loan load. A laid-off worker in the concert industry said they used a 401(k) loan. Some people interviewed said they had already dipped into their savings.

Lamonte Goode, a 44-year-old dancer, says he may tap his savings to begin paying the roughly $10,000 in back rent he owes. With COVID-19 restrictions halting TV shows and theater performances, Goode said he hadn’t found steady work since March and was looking for a job outside his field to pay bills. Unemployment hasn’t been enough to cover expenses, including the $1,800-a-month rent on his one-bedroom in West Hollywood, he said.

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Asked if he thought he would be able to repay the debt, Goode said he didn’t know and that he was trying hard to come up with the money. He also raised the question: Should the burden fall on him? “I am not the reason COVID is happening. Yet I still have to pay the debt for something I am not in control over.”

“The fact that someone lost their job and couldn’t keep up on rent is a very unique and extreme circumstance and does not and should not have a bearing on their creditworthiness for this next almost-decade,” said Nisha Kashyap, a staff attorney at the pro bono law firm Public Counsel, citing how long bad debts typically stay on a credit report.

“This is a global pandemic that came out of nowhere.”

Sid Lakireddy of the California Rental Housing Assn., which represents landlords in the state, says he believes fears of mass evictions and long-term harm to credit are overblown. Most landlords would rather work with their tenants on repayment plans than fight in court over an eviction or debt, he said, particularly since vacancies have risen in many cities. “The last thing we want is to put a good tenant out on the street.”

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The federal government and state and local officials say they are trying to help both tenants and small landlords, who are also struggling.

Then-President Trump signed a bipartisan stimulus bill in December that approved $25 billion in rent and utility relief funds nationwide. President Biden extended the national eviction moratorium for people with pandemic hardships until the end of March, though critics say that ban is weak.

The new California law is stronger and contains provisions to reduce the likelihood that pandemic debt will have wide ripple effects.

Under the law, landlords cannot sell or assign any rent debt accrued during the pandemic until July 2021.

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Russ Heimerich, a spokesman for the state’s Business, Consumer Services and Housing Agency, said the law goes even further for low-income tenants with pandemic hardships: It forever bars landlords from selling rent debt accrued through June.

That would prevent a primary way credit scores could take a hit, since it’s usually debt collectors rather than landlords who report to the credit bureaus, said Nelson, the attorney. Heimerich said the law also included several incentives for landlords to participate in the rent relief program for low-income tenants, and that making it mandatory would have been legally impractical.

Still, critics of the law say it relies too much on tenants knowing their rights and having the means to exercise them, putting the least-resourced in a weak position to benefit.

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Some tenants have already been evicted, said Stephano Medina, an attorney with the Eviction Defense Network, during a recent news conference held online by tenant advocates on their concerns about the law. Moratoriums don’t stop landlords from filing cases, and tenants sometimes don’t realize they need to show up in court to defend themselves, Medina said.

One part of the law that is likely to be particularly hard to enforce is a clause that prohibits landlords from denying housing based on rent debt accrued during the pandemic, said Leah Simon-Weisberg, legal director with Alliance of Californians for Community Empowerment, an organizing group that advocates for low-income households. Prospective landlords often screen tenant candidates through their former landlords, allowing them to learn of debts they aren’t supposed to base decisions on.

It’s also unclear how many landlords will participate in the state’s rent relief program, which will pay landlords 80% of what they are owed if they forgive the remaining 20%. Lakireddy said that’s a good deal, and many landlords are likely to accept it.

California’s rent-control laws may complicate the landlord’s decision, said Tina Rosales, a lobbyist with the Western Center on Law and Poverty. Under state law, landlords can charge as much as they can get for a rent-controlled unit once it becomes vacant. So it could be more lucrative to pursue an eventual eviction and not forgive debts if a tenant is paying significantly below market rates.

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“It has the potential for landlords to pick and choose which tenants they will participate in the program with,” Rosales said, potentially affecting the most vulnerable.

Another outstanding question is how far California’s rental relief funds will go, given the range of estimates of how much rent people owe. Some tenants, for example, might miss out on debt forgiveness — not because their landlord won’t participate but because the pool of money runs out.

For many who can’t work from home, the cost of staying housed becomes a choice between incurring debt or accepting the risk of contracting COVID-19 on the job.

One family’s hard choices

The Buenos, a family of five in Los Angeles’ Koreatown neighborhood, were like many of the country’s hardworking households. Fernando prepped fish for a sushi chain. His wife, Maribel, cooked at a downtown L.A. brunch spot.

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Maria, 23, the eldest of three sisters, worked at a big-box retailer and helped out with the family bills. She set a goal to own her own home by 30.

The Buenos are now scattered. A promotion sent Maria’s father to New Jersey before the pandemic, but his hours were soon cut as lockdowns were put in place. Her mother lost her job and moved across the country with her youngest daughter to join Fernando.

At home in Koreatown, the bills fell on Maria, who stayed behind with her 18-year-old sister, Pamela. Their parents send money, but even coupled with Maria’s $20-an-hour wage, it’s not enough to cover the $2,500 in monthly rent. She exhausted her $3,000 in savings and is still $15,000 behind on rent.

Maria worries about how she’ll protect her younger sister and keep both of them from becoming homeless.

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James Engel, a principal with the company that manages Bueno’s building, said the company planned to work with residents on multiyear repayment plans when rent protections expire, rather than pursue evictions and collections. He wouldn’t comment on individual tenants’ cases.

Maria says she doesn’t want to risk having the debt over her head and is looking for a second job during the pandemic.

The possibility of getting sick is a sacrifice she’s willing to make.

Source: latimes.com

Mortgage rates hit (another) all-time low – CNN

The average 30-year fixed-rate mortgage fell to a record low of 3.07% this past week, according to Freddie Mac. That’s the lowest level in the nearly 50 years of the mortgage giant’s survey. The 15-year fixed-rate mortgage dropped to 2.56%.
The average rate for a 30 year-fixed mortgage dropped below the previous record low of 3.13% that was set in June and marks the fifth new low since March. A year ago, the rate was 3.75%.
The data suggests the recent rebound in economic activity has come to a halt over the last couple of weeks, with some declines in consumer spending and a pullback in purchase activity, according to Freddie Mac.
“Today’s report shows mortgage rates declined as investors reacted to the surge in Covid cases and the Federal Reserve’s concerned outlook for economic recovery,” said George Ratiu, senior economist at Realtor.com
Even with rates moving toward the 3% mark, lenders maintained tight underwriting standards which contributed to a decline in mortgage applications for the second consecutive week, he said.
“Mortgage rates this low, coupled with current demographics favoring homeownership, would normally lead to strong sales activity,” he said. “However, getting approved for a loan is proving to be a difficult challenge for many, especially first-time homebuyers who struggle to come up with a 20% down payment.”
The national housing market saw a glimmer of hope this week as an index measuring homes in contract to sell, or pending sales, jumped by a record 44% in May, according to the National Association of Realtors.
But the longer term picture is murkier. Ratiu said real estate markets are moving through a transition period.
“On one hand, buyers are clearly returning to the market, eager to take advantage of low interest rates while moving toward a new normal,” he said. “On the other hand, the strong resurgence in Covid cases, especially in Sun Belt states, along with broader economic uncertainty during the current recession, is holding many sellers back from entering the market.”
These people bought homes without ever stepping insideThese people bought homes without ever stepping inside
This week mortgage applications dropped 1.8% from the week before, according to the Mortgage Bankers Association’s weekly application survey.
“Investors are contemplating the risks of the recent resurgence of Covid-19 cases to the labor market and economy, and Treasury rates and mortgage rates are moving lower as a result,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting.
“The weakening in activity is potentially a signal that pent-up demand is starting to wane and that low housing supply is limiting prospective buyers’ options,” he said.

Source: cnn.com

MBS Day Ahead: Bond Buyers Sitting on Hands; Which MBS Coupon Now?

We talked about momentum indicators being ‘oversold’ yesterday–a possible prelude to a friendly bounce in bonds.  If that narrative is going to play out, it’s running out of time very quickly.  There was some potential for a positive outcome early in the overnight session, but as the trading day progresses, bonds are moving steadily back toward their weakest levels.  Those with the strongest stomachs can still hold out hope that 10yr yields have temporarily topped out somewhere under 1.33%, but all bets are off if that ceiling breaks today (and we’re only 2bps away at 9am).

20210218 open2.png

If the pace of bond market weakness has caught you off guard in 2021, you’re not alone.  Many analysts and traders are struggling to justify current levels.  In their defense, it’s very easy to get caught up in a search for obvious, short-term motivations.  After all, that’s what’s usually moving the market.  Interestingly enough, the same analysts and traders (including myself in this list) wouldn’t shut up about the fate of the bond market being tied to covid for most of 2020.  Many of us have kept that correlation too far on the back burner so far in 2021, but it’s quickly making a comeback because it’s a very handy explanation for a sea-change in the bond market.  Case in point: yields leaming quickly higher in 2021?  And what are covid case counts doing?

20210218 open3.png

Granted, this is far from the only input for rates, but the abrupt drop in case counts so far in 2021 definitely helps explain some of the seemingly inexplicable urgency behind the selling.  If that’s the case, though, why are stocks selling today specifically?

20210218 open.png

Late 2018 provided a good reminder to markets about the power of rising rates to prompt stock market weakness.  Big, abrupt spikes in rates make traders question gravity-defying stock prices.  It’s that simple.  If you want to make it less simple, you could consider that the “stuff” that prompts big, abrupt spikes in rates tends to also decrease the probability of massive, ongoing fiscal and monetary support.  A certain amount of both of those things is currently priced in to future trading levels.  The monetary piece–especially–helps both stocks and bonds.  So when traders see it as incrementally less likely, both stocks and bonds can take a hit.

Last but not least, what’s up with MBS coupons?  Why are some getting hit way harder than others and what should we be watching now?  The short answer (if you’re looking to keep an eye on negative reprice risk throughout the day) is that 2.0 coupons are the best to watch, but 2.5 coupons are very close to taking the reins at current levels.  Either would work.  2.0s will be more sensitive to market movement (good option if you float with jumpy lenders).  

As for why lower coupons have been hit harder recently, this is always the case in a rising rate environment.  Lower coupons have higher durations because they’re less likely to be refi’d.  That makes them perform more like a longer-dated Treasury bond in the eyes of investors, and longer-dated bonds are getting killed recently.  The following 2 charts tell the story perfectly.  One shows the absolute change in price in 4 MBS coupons since the beginning of the year.  The other shows the same for Treasury yields in 2, 5, 10, and 30yr maturities.  The longer the duration (or the lower the MBS coupon), the bigger the sell-off has been.

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Source: mortgagenewsdaily.com

COVID accelerated migration trends, but is it sustainable?

Even Norman Rockwell couldn’t put a rosier cast to New Hartford, Connecticut, in mid-autumn. On the far western outskirts of the Hartford metropolitan area, the town’s converted brick mill buildings are now occupied by restaurants that sell and serve locally grown produce and locally made artisanal cheese. A river – the Farmington – really does run through the town, shallow and sparkling, punctuated by occasional fly-fisherman. Bridges arch over the river from stands of yellow-leafed birches to groves of flaming maples.

It’s exactly the kind of place that’s attracting pandemic-panicked New Yorkers who, drawing a circle of two hours’ train travel from Manhattan, figure they can set up parallel lives in the country and city. 

The COVID-19 crowds that are now seeking fresh air and socially distanced living are looking beyond what is considered more traditional second-home destinations to small towns that have struggled to catch the updraft of the broadband revolution. As city dwellers scatter, enough of them are landing in the semi-rural spots to potentially realign the very definition of economic development, land use and the consequent cascade of broad band investment, municipal services, taxation and local spending priorities. 

“The economy is moving faster than the population,” said Mark Lautman, an economic development consultant who has helped local organizations in New Mexico and elsewhere forge partnerships that serve residents and employers.

In the past, economic development was defined by incentives for buildings and infrastructure with the aim of winning and keeping employers with substantial numbers of workers. 

The COVID-19 pandemic has accelerated a longer-term trend of separating talent from location. Economic development leaders are just starting to realize the profound implications of a distributed workforce on their local economies, workforce development, housing and real estate markets, he said. 

“If you don’t have qualified workers, you can’t grow your economy,” Lautman said. “And all of a sudden, the cost of place of operation is zero. States throw massive resources at site-based economic development but remote economic development needs a fraction of that.”  

Investors are already moving money into place to catch the coattails of COVID-catalyzed change. 

Collin Gutman, managing partner of SaaS Ventures, a Washington, DC-based venture capital firm that works specifically with young companies in smaller metropolitan areas far from Silicon Valley, said that the pandemic has propelled high tech companies to redefine where and how they look for talent.

“Previously there had been a perception that these types of businesses could only get critical mass of talent in San Francisco or Boston,” he said. “That perception has changed very quickly in the past 12 months. We’ve seen an outflow to places like Louisville, Lexington, Nashville and people buying second homes in rural counties.”

Daniel Jeram is New Hartford’s First Selectman, the top official of the 7,000- resident town. He said he hasn’t seen anything quite like this year’s real estate sales burst.  

“The game is on and it has been for months,” Jeram said. “You can tell from the license plates driving around town.” 

He isn’t kidding. Regional market reports from the Greater Hartford Association of Realtors released at the end of 2020 show that year-over-year, pending single-family home sales rose 49.9%, days on market dropped by 32.1% and the median home sale price rose 13.3% to $280,500. 

Maintaining the growth

With young families pouring in, New Hartford’s challenge is how to keep them, especially as support for enhanced broadband has been under discussion for years, with little progress, Jeram said. New Hartford is on the eastern edge of a subregion of northwestern Connecticut and southwestern Massachusetts that suffers from weak cell coverage and tepid broadband. 

“We’re okay,” said Jeram, of New Hartford’s cable service, “but that is an ongoing debate that state and local leaders are struggling with, because cost to get broadband in is extremely high. Everyone knows it’s the wave of the future, but how will we pay for it?”

Rista Malanca is trying to figure that out. She is director of economic development for neighboring Torrington, where broadband somewhat peters out. 

“We’re attractive and affordable for a lot of people, but how do we keep them engaged, so they center their lives here, and spend their money here?” Malanca said. 

Powerful broadband paves the digital way for not just telecommuting and remote collaboration, but also for telehealth, remote education for children and adults and a host of other services that frame the new hybrid of a sophisticated information economy invisibly driving growth.  

Consultants with McKinsey project that 22% of companies expect to hire more remote freelance workers in the foreseeable future. Before the COVID-19 pandemic reordered the American workforce in March 2020, only 4.9% of full-time U.S. workers telecommuted from their homes. By the end of June, 42% of the workforce was home-based, and workforce researchers expect that the dramatic shift is largely permanent. FlexJobs, a Boulder, Colorado-based employment site that serves both individuals and employers, projects that capturing work-life balance and reducing commuting stress are top priorities for people who want to move and either bring their jobs with them or find remote work.

Changing lifestyle

Professionals who bring high-paying jobs with them also transplant demand for higher-end dining, grocery, local entertainment and home renovation and maintenance services, said Shaun Greer, vice president of sales and marketing at Vacasa, a Portland, Oregon, company that provides property management services to more than 21,000 vacation homes in North America. 

Unlike short-term renters, professionals relocating for a full-fledged second hub where they can work and attend school remotely, need functional and municipal services largely different from tourist demands. 

“If this trend continues, it will affect municipal budgets,” Greer said. “Most of these communities are restricted in some way, such as [their level of] power or utilities. If this growth continues they’ll have to put in a lot more infrastructure to keep up.”

New Hartford could take a cue from The Peoples Rural Telephone Cooperative in McKee, Kentucky, population 800. 

In 2007, the cooperative, formed in 1950 and serving two rural Kentucky counties, decided to go all in on broadband, related Keith Gabbard, who has been the cooperative’s CEO for the past 25 years. Patching together about $50 million from federal, state and local sources, the service committed to bringing broadband to every home in its service area. 

“Since 2014, we’ve had gigabit service to every home and business,” Gabbard said. “Once we got it built, we realized, ‘what do we do with it?’ We had to become more economic-development minded.”

Gabbard took on the role of one-man employment liaison, workforce training advocate, lobbyist to state legislators and public relations cheerleader, relentlessly promoting the cooperative’s ready, willing and connected workforce at conferences. Working relationships with national workforce development agencies and platforms – including FlexJobs – produced a stream of inquiries from American companies seeking to bring operations back to the U.S. from overseas, and looking to expand domestically. 

“It’s been amazing,” Gabbard said. “In the last five years we’ve had 1,100 teleworks jobs created. People move here because of the internet and we’re seeing even more of that because of the pandemic.” 

McKee still lacks a Starbucks, but it is making inroads with establishing a healthcare clinic that will pivot on telemedicine. And, Gabbard has even drawn local Amish into the high-speed loop as the cooperative hires their construction crews to expand into neighboring counties. 

Communities that were a step ahead are both riding the first crest of post-COVID change while demonstrating the importance of close collaboration among regional economic, workforce and housing development authorities, investors and the private sector.

Broadband brought jobs to northwest New Mexico in 2017 and has anchored the local economy even as the COVID-19 pandemic has rolled from crisis to chronic. Shelly Fausett runs the SoloWorks program in the area, which advocates for workforce development and related supports, and which helps employers find and hire connected workers. SoloWorks had just moved to a new a co-working space to build capacity for distributed teams but the health care crisis kept workers home…and working. 

“Right now in customer service, there are more jobs than people,” Fausett said. 

The 2020 COVID-19 pandemic simply accelerated long-term trends toward remote work, annihilating embedded cultural resistance and rapidly realigning work processes to support sustained collaboration and productivity from any location, said Brie Weiler Reynolds, the in-house career development coach for FlexJobs. 

Remote work surged for both staffers who have always had the capability to work from home and among the current and aspiring self-employed who immediately seized the opportunity to redesign their careers around the location and lifestyle they had always craved. In March, the FlexJobs platform received a 50% increase of inquiries and applications from workers, she said. 

Companies and employment agencies – private and government-run – that already collaborated with local economic development and workforce training programs had a big head start on those that had in place only traditional programs, Weiler Reynolds said. Cross-functional workforce development programs that “combine broadband outreach with remote work training and company partnerships and that partner with FlexJobs to find the actual jobs, are serving people who already live in their areas and are hiring specifically from economic groups hard-hit by the tourism and hospitality industries.”

Workforce housing that is designed around and for home-based work will ensure lower paying, broadband-dependent jobs, such as customer service, highly skilled software developers and managers cut a very different profile, SaaS Ventures’ Gutman said. They are “six-figure Millennials” who expect, if not big-city culture and amenities, at the very least, transportation services that can quickly deliver the big city to the rural doorsteps of spacious houses with dedicated home offices. 

And, the ability to quickly get to major cities will be a key plank of rural economic development, especially as patterns of post-pandemic life emerge, he said. High-tech transplants want lots of fresh-air recreational amenities but also want to take just one connector flight to a major air hub. 

“It could be that saving the regional airport is your key to economic prosperity,” Gutman said. 

COVID redefines tourism economies

The return on remote work-equipped workforce housing is short and sweet for communities long tied to cyclical tourism economies. A solid base of long-term second-home owners is already redefining tourism economies, Greer said, extending the 2020 season well into autumn, and thus continuing demand for cleaning, maintenance, renovation and some municipal services and activities. 

“What we’re excited about is that this change means we keep more of our seasonal employees, hopefully longer,” he said, adding that a greater number of staycation homeowners could permanently stabilize tourist-town employment, municipal and local business cash flow and demand for broadband and other services.

The pandemic has proven the possibilities and powerful potential of a distributed workforce and, by extension, distributed economic development, said one longtime broadband researcher and advocate. 

“The pandemic could yield a lasting legacy if municipalities, counties and states forge regional alliances for economic development, and use their combined power to rapidly build universal broadband, align tax policies and regulatory incentives to encourage private and public expansion of broadband to connect all American citizens,” said Rouzbeh Yassini, executive director of the Broadband Center of Excellence at the University of New Hampshire in Durham, New Hampshire. “States need to relinquish counterproductive strategies focusing on stealing businesses from each other and combine forces. That’s the only way that many small towns and rural areas will gain critical mass to justify private investment in 5G, both through wired (cable and phone) and wireless services. 

“If you get five or six state governments together, and get regional connectivity vision established, they’ll improve the economic value of that entire region for web-based daily services and for mapping, driverless cars and gain scale for recruiting residents, farmers and business,” Yassini said, citing the cascade of connected services that could support remote working, aging in place and other life-enhancing functions. 

Lautman, the economic development consultant, detects a rapid realignment of the definition of economic development with state and local resources to support distributed workforces. Hybrid strategies that blend satellite nodes for regional managers and occasional team meetings are a natural evolution of the urban model of co-working spaces, he said. The pandemic has also elevated the importance of health care, childcare and related services as essential to workforce stability and productivity. 

As professionals and corporate leaders become acclimated to working from their second homes, they might become influential advocates for their industries to pivot to distributed workforce development, potentially bringing economic development authorities and broadband providers with them.  

“To create an environment that incentivizes and supports remote work, if I were a local economic development executive, I’d be at my state legislature asking for the same incentives to build houses with home offices that they give to industrial developers,” Lautman said. “Now we have a residential real estate platform for economic development.” 

Source: housingwire.com

Time to Wake Up To The New Mortgage Rate Reality

There’s no precedent for the winning streak enjoyed by mortgage rates in the 2nd half of 2020. We’ve never seen so many new record lows in the same year, and we never spent as much time at those lows (not even close). All of the above makes it easy to get lulled into a false sense of low-rate security, but it’s time to wake up.

Actually, the alarm has been going off for a while now.  Previous posts pointed out the disconnect between the bond market and mortgage rates on multiple occasions in 2020.  Near the end of the year, we warned against complacency in no unspecific terms.

Following the Georgia senate election, we’ve been tracking a surge in bond market volatility based on the expectation that it would increasingly spill over to the mortgage rate world. 

(Read More: 1/8/21: Have We Seen The End of Record Low Rates?)  

As of this week, that spillover arrived in grand fashion with many lenders quoting rates that are as much as three eighths of a point higher than they were last week.  That means if you were looking at something in the 2.75% neighborhood on Friday, it could be 3.125% today.  What gives?

Again, the upward pressure is nothing new.  Treasury yields have been telling the story since August and mortgage rates have finally used up enough of their cushion that they’ve been forced to follow the broader trends. 

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Why have things been so abrupt?  Using up “the cushion” is one thing, but that alone doesn’t force rates to go higher.  For that, we need “broader bond market volatility.”  In other words, Treasury yields need to be spiking. 

As it turns out, that’s been one of their favorite things to do in 2021.  If it seems abrupt, that has a lot to do with bonds coiling in a conservative pattern heading into the Georgia senate election, and unleashing chaos thereafter.

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The election is old news now though.  It simply got the ball of volatility rolling.  Most recently, plummeting covid case counts, improved vaccine distribution, stronger economic reports, and progress on fiscal stimulus reinvigorated the volatility.  This week, 10yr yields broke up and out of their prevailing “trend channel” (the parallel lines seen below). 

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There’s no magic rule that says Treasuries have to stay inside those red lines, but this sort of breakout can be a cue for traders to intensify selling pressure.  In other words, that upper line was a trigger for yields to move even higher.

“But wait… I thought the Fed said it was keeping rates low for YEARS.  What happened to that?”

The Fed sets the Fed Funds Rates… NOT mortgage rates.  The Fed Funds Rate is a super short-term rate (“overnight,” in fact).  10yr Treasuries, on the other hand, last 10 years.  The average 30yr fixed mortgage lasts between 5 and 10 years depending on the market conditions.  Investors place different premiums on rates with different terms.  Simply put, the Fed Funds Rate is indeed still at rock bottom, but longer-term rates are not.

20210219 nl6.png

This isn’t anything new or different, for what it’s worth.  The Fed Funds Rate has always ebbed and flowed in relation to longer term rates.

20210219 nl7.png

“But wait… I heard that mortgage rates are still really low and that they only went up a tiny amount this week!”

Well, that depends on your perspective.  Is 3.125% still really low for the average 30yr fixed mortgage rate?  Yes!  That was the all-time low before covid.  But is it much higher relative to the past few weeks and months?  Here too, it depends on your perspective, so let’s leave it at this: rates rose more this week than on any other week in the past 11 months.

If you’ve heard that rates only rose slightly, it may have to do with headlines quoting Freddie Mac’s weekly survey.  While that survey is accurate over time, it doesn’t capture short-term volatility.  It also tends to stop measuring most of any given week’s volatility on Monday, and Monday was a holiday!  As such, it’s lagging the reality on the street.  

20210219 nl4.png

On the economic data front, Retail Sales (this week’s biggest report) rose at the 4th fastest pace since records began in the early 90s.  In general, stronger economic data puts upward pressure on rates.

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In terms of housing-specific data, this week brought an update on residential construction numbers.  They’re still stellar.  

20210219 nl2.png

Whereas Housing Starts are subject to weather-related delays and other potential roadblocks, building permits are a bit more free-flowing, and they just set another long-term high.

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Source: mortgagenewsdaily.com

MBS Day Ahead: Selling Gets Serious; Yields Near Post-Covid Highs

Last week ended with snowball selling in the bond market.  Given the approach of a holiday weekend, there was a chance that the weakness was overdone and that we’d see a bounce back today, but it didn’t take long for those hopes to be crushed in overnight trading.  This is the kind of bond market weakness that forces analysts to find/amplify root causes after the fact, because there really hasn’t been a strong case for this much selling (even if there’s a well-understood case for steady selling in general).  

To be clear, evidence in the “well-understood case” is as follows:

  • Plummeting covid case counts
  • Businesses weathered the Dec/Jan surge much better than the initial lockdowns in the Spring
  • Vaccine distribution improving
  • Economic data at home and abroad has been resilient
  • Massive central bank support
  • Fiscal stimulus expectations (looking like “bigger and sooner” now)
  • Strong corporate earnings, strong stocks, and more of the same expected as sidelined cash flows back into market
  • Heavy bond market supply (ties in with stimulus, since Treasuries are used to pay for it) as well as corporate bond supply
  • Inflation expectations (monetary + fiscal stimulus increasingly expected to stoke inflationary fires).

This list could go on, but that’s already plenty of justification for an ongoing rotation/recovery trade that favors stocks and shuns bonds.  It jives perfectly well with the ongoing uptrend in yields that we’ve been tracking for months and months.  The only surprise at this point is how aggressive the selling has become in the past few days with 10yr yields only about 2 bps away from March 2020’s highs (1.26 vs 1.28%).  Bonds are also challenging the upper boundary of their prevailing trend.  Early January increasingly looks like a ‘sea-change’ moment following the GA senate election (with the late Jan rally now looking like a brutal head-fake).

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This is the sort of thing that CAN be good news as it suggests a bounce back in the other direction, all other things being equal.  But that suggestion assumes the trend continues at the same pace, and that’s never a guarantee.  Assessing the validity of that trend will be the first order of business today and tomorrow.  If we don’t see a big, strong bounce back in bonds, it may be over.


MBS Pricing Snapshot

Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.

MBS

UMBS 2.0

102-09 : -0-10

Treasuries

10 YR

1.2640 : +0.0640

Pricing as of 2/16/21 9:26AMEST

Tomorrow’s Economic Calendar

Time Event Period Forecast Prior
Tuesday, Feb 16
8:30 NY Fed Manufacturing Feb 6.00 3.50

Source: mortgagenewsdaily.com

Stock Market Today: Dow Marks New Highs, Tech Makes a Mess

Investors were put through the information wringer on Wednesday, and the major blue-chip indices finished the day with pretty disparate results.

The January retail sales report was, in the words of Barclays strategists, “significantly stronger than expected,” showing overall sales up 5.3% month-over-month following three straight months of declines.

“We had expected an overall improvement in January sales, after three months of declines,” says Pooja Sriram, vice president, US Economist at Barclays Investment Bank. “In particular, we expected the additional support to households from government pandemic-relief programs to support spending.

“Households started receiving the $600 per individual rebate check in January, as well as the federal unemployment assistance of $300 per week, under the COVID relief bill signed into law in late December.”

Another sign of economic resilience was rising U.S. wholesale inflation, which rose 1.3% month over month in January, reflecting strong domestic and export demand alike.

Interestingly, minutes from the January Fed meeting, released today, demonstrated worry about America’s path, with participants noting that “economic conditions were currently far from the Committee’s longer-run goals.”

“The minutes from the latest Fed meeting didn’t stray too far from the message Fed Chair Powell has been sending to market participants in his recent speeches where he indicated it’s not the right time to change policy,” says Charlie Ripley, senior investment strategist for Allianz Investment Management.

However, Bob Miller, BlackRock’s head of Americas Fundamental Fixed Income, says even the past few weeks since that meeting have “left that meeting’s minutes looking somewhat stale.”

“If we see vaccinations continuing apace, delivery of pending massive fiscal policy support and the arrival of warmer weather, we expect the resumption in spring of more ‘normal looking’ levels of previously shuttered economic activity. If accurate, the economy will be making ‘substantial further progress’ toward the FOMC’s goals – to use the Committee’s guidance for when they might no longer want to maintain the current pace of asset purchases.”

U.S. crude oil futures continued to climb amid supply disruptions in Texas, by 1.8% to $61.14 per barrel, pushing up the likes of Dow Jones Industrial Average component Chevron (CVX, +3.0%). The Dow managed to notch another record high, finishing up 0.3% to 31,613. However, a technology-sector slump sent the Nasdaq Composite 0.6% lower to 13,965.

Other action in the stock market today:

  • The S&P 500 slipped marginally to 3,931.
  • The small-cap Russell 2000 lost another 0.7% to 2,256.
  • Gold futures declined for a fifth consecutive session, falling 1.5% to $1,772.80.
  • Bitcoin prices, at $48,783 on Tuesday, shot 7% higher to 52,266. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m. each trading day.)

stock chart for 021721stock chart for 021721

Out Now: Buffett’s Latest Picks

Yes, Chevron did have swelling energy prices on its side, but it also had a new ally: Warren Buffett.

The legendary value investor and CEO of Berkshire Hathaway (BRK.B) unveiled his latest transactions in a Tuesday evening 13F filing to the SEC, revealing that his holding company had taken a stake in the integrated energy giant during the final quarter of 2020.

And that was far from Uncle Warren’s only move.

Buffett, just like many retail investors, spent much of 2020 making wholesale changes to the Berkshire Hathaway equity portfolio. He was every bit as active during Q4, entering four new stakes, exiting five stocks outright, and tinkering with another dozen positions.

If you’re curious as to what the Oracle of Omaha is bullish on, or what has fallen out of his favor, read on as we examine each of Warren Buffett’s 21 latest portfolio moves over the most recent quarter:

Kyle Woodley was long Bitcoin as of this writing.

Source: kiplinger.com

How to Prevent Identity Theft (From Someone Who’s Been Through It)

My name is Tiffani Sherman. The real Tiffani Sherman. Not the one who recently applied for unemployment benefits, an SBA COVID loan, five credit cards, a payday advance, two loans, and opened two bank accounts.

That wasn’t me.

It also wasn’t me back in early 2019 who ordered a bunch of expensive stuff online and then changed the shipping addresses, drained rewards points accounts to buy gift cards, hijacked Amazon and eBay accounts, and monitored and deleted emails for weeks.

For the second time in two years, I’m dealing with the fallout of identity theft.

Trust me, it isn’t fun.

I’m having to prove I didn’t apply for all of these things and that is taking a lot of my time and energy.

I’m not alone, which doesn’t make me feel all that much better.

Identity Theft Is Down, but the Damage Is Worse Than Ever

According to the The 2020 Identity Fraud Report by Javelin Strategy & Research released in May 2020, losses from identity fraud totaled $16.9 billion, which was up 15% from the year before.

According to the report, instances of fraud are falling but the damage they are doing is increasing. Thieves are shifting from fraudulent credit card changes to account takeovers. This kind of thing yields more, is more complex to prevent, and takes longer to fix.

Most of the damage happens within a short period of time. The Javelin research says 40% of the activity usually happens within a day.

With my latest go-around, all of the applications were completed within less than 72 hours.

“It’s a very rapid period of time because eventually they’re going to experience some friction,” said John Buzzard, fraud and security analyst for Javelin Strategy & Research. “They have a small working window of time to really do that total takeover.”

How Did Scammers Get My Data?

Almost everyone who heard about my ID theft problems asked me how people got my data.

I honestly don’t know. I do know I was part of several high profile data breaches, but who knows if that was it or not.

Scamicide founder Steven Weisman, a nationally recognized expert on identity theft, scams and cybersecurity, says most identity theft happens in one of two ways.

The first is when we accidentally give out our data. “We may have clicked on a link in a text message or an email that had keystroke logging malware that stole the information from our phone or our computer or we may have been tricked into giving personal information over the phone to someone,” he said.

We all get those calls and emails where the person says they work for a computer giant and noticed a problem with your computer, or they’re from the government and they need your Social Security number. Some of them can sound pretty ominous, so it’s easy to fall for them.

Also, think about how many places ask for information like your Social Security number and date of birth.

“Just because somebody asks you for information, that doesn’t mean you have to give it to them and that’s just something people don’t understand,” Buzzard said.

Recently, a grocery store employee asked for his Social Security number when he applied for a store rewards card. “I said, no, I’m sorry. You can have my cell phone number if you need an identifier. If you need a Social, we’re done here. You’re a grocery store, not exactly a high level security operation. The person folded, put in my cell, and off I went with my rewards card.”

The other way scammers get your data is through hackers.

“No matter how good you are at protecting your personal information we’re only as safe as the places with the weakest security,” Weisman said. “With so many people working remotely these days, people are going to be hacked at home and then through them, [hackers] will get at the networks of the companies for which they work. I think we’re going to have a massive amount of major data breaches.”

Then the information becomes like pieces of a puzzle.

“It’s like a patchwork quilt,” Buzzard said. “You pop somebody’s information in and you play around with it.”

A woman stands in her backyard with green plants around her and a white fence behind her.
Sherman doesn’t know how scammers got her data. Recommended ways to protect yourself from identity theft include setting up alerts, checking your monthly billing statements and using digital wallets. Chris Zuppa/The Penny Hoarder

7 Ways to Make It Hard for Scammers to Use Your Data

Since much of this is basically out of our control, there are some things you can do to make it a bit more difficult for a scammer to use your data if and when they get it.

1. Protect Your Credit

Thieves make easy money with your credit either by charging things on existing cards or opening new credit cards. Either way, they charge a bunch and leave the unsuspecting victim with the bill and damage to their credit.

Even though you’re not responsible for fraudulent charges on your credit cards, the hassle you go through to remove the charges is worth taking steps to prevent it.

  • Check your bills: Look at monthly statements and report any charges you do not recognize.
  • Set up alerts: Most credit card companies let you set up text or email alerts whenever your card is used. If an alert every time is too much, you can often change the settings to let you know if a card is used without the physical card being present, or if a charge is higher than a certain amount. I’ve received several notifications that have let me know someone was up to no good, and I was able to quickly report it and cancel the cards.
  • Remove saved payment methods: I know it’s convenient to not have to type in your credit card every time you order something, but having a saved payment method makes it easy for someone who gains access to an online account to do a lot of damage very quickly. This is what burned me in 2019 when someone gained access to my Amazon, eBay and other accounts and bought several things using my card.
  • Use digital wallets: This type of technology uses encrypted and tokenized data so if someone steals it, it is worthless to them.

2. Freeze Your Credit

Both Weisman and Buzzard said the most important thing to do is freeze your credit. Doing this should stop anyone from opening credit accounts using your information.

When someone wants to open a credit card or get a loan, the institution needs to check the applicant’s credit history to know if they are worth the risk or not.

When you have a credit freeze, nobody can access your credit history, so financial institutions will not be able to get the information they need to open an account. This becomes important when a scammer tries to use your personal information to open a fraudulent account. The freeze will automatically stop the account from being opened.

If you want to legitimately open a line of credit, all you need to do is temporarily unfreeze your credit. Just remember to freeze it again.

Each bureau operates separately, so freezing one does not freeze them all, as I found out the hard way. After my issues in 2019, I thought I had frozen all of my credit, but it turns out everything was not frozen. That’s how the scammers were able to do so much damage this go-around.

I think it should be easier to freeze your credit and protect yourself from identity theft. Weisman agrees. However, the bureaus make money by gathering your information and selling it to lenders.

“If you freeze your credit, [the bureaus] can’t sell the access to your credit,” Weisman said. “Freezing your credit makes you less valuable to the credit reporting agencies.”

Since Equifax had a huge breach a few years ago, freezing and unfreezing credit is free.

Everyone’s credit is separate, so a couple needs to each freeze their credit individually. Freezing one does not freeze the other’s. Also, parents can freeze the credit of their minor children.

Even with your credit frozen, check each bureau’s credit reports periodically to make sure nothing has gotten through. Also, check to make sure everything is still frozen.

This illustration shows a woman typing in her saved password.
Getty Images

3. Protect Passwords and Personal Information

Part of my problem in 2019 was that someone got hold of several of my passwords, including the email account I used for most of my logins and online commerce. I admit, at the time I was less than vigilant about having a different password for anything and everything. Trust me, that has changed.

As I said, lots of my information including several website and password combinations were part of several well-known data breaches that have happened during the past few years. During these breaches, fraudsters hacked into databases and got the info.

Then they sold that information on the dark web or in other ways. One of those other methods is something called a combolist service (CaaS), which is increasing in popularity. People pay a monthly fee for lists of updated and stolen credentials and personal information that is accessible in the cloud.

I looked and lots of my information is unfortunately part of these combolists.

Once the information is out there, it’s impossible to remove it, so all you can really do is change your passwords and keep changing them regularly.

If you forget a password, you can usually reset it by answering some security questions. These present their own set of problems because often the answers are things people can easily find out about you.

“The easy way around this is there is absolutely no rule that says you have to answer your security questions honestly,” Weisman said. “You can have really what seems like vulnerable security question like my banks, which is what’s my mother’s maiden name, but I can put down that my mother’s maiden name was firetruck or grapefruit, or something equally ridiculous. And the good thing there is, you will remember that security question, because it’s just so ridiculous and no one is ever going to be able to crack that.”

As for those password vaults, security experts are mixed about them. One remediation expert I talked with to help me with my issues said she doesn’t like them because if someone breaches the vault, they have access to everything. Other people say they are a good way to make sure you have strong passwords for everything.

4. Don’t Give Out Information on Social Media

I just saw a post on a friend’s social media page saying the song that was most popular the week you turned 14 defines who you are. It also defines the year you were born to any online scammer who is looking for that important piece of information.

The same goes for quizzes that talk about favorite pets, first cars, favorite teachers, school mascots, etc. Seeing those types of things now makes me cringe. Many people are making it way too easy for scammers.

5. Enable Two-Factor Authentication

Enabling two-factor authentication is also important. If someone tries to log into your account, the vendor will send a one-time code either to the email address or phone number on file.

“Data breaches will happen,” Weisman said. “People will make mistakes and fall for a spear phishing email and suddenly they may have had their usernames and passwords turned over. So you always want to have dual factor authentication whenever you can so even if someone has your username and password, they can’t access your account.”

Just make sure you protect your phone also by enabling its security features.

To save you the hassle of having to receive a code each time you want to log into your own accounts, some websites will allow you to save devices so the next time you log in, it will remember that device’s IP address and allow the login without the extra security.

Be wary of any email, phone call, or text you receive saying something has been compromised and to click on a link or call a number to reset it. Instead of clicking on the link, go to the website or app itself and reset the password directly from there.

A man uses face recondition to get into his phone.
Getty Images

6. Secure Devices

We live for our devices. They’re our constant companion and contain our whole lives. Protect them.

  • Update operating systems and security software: Companies issue updates once they identify a vulnerability a hacker could exploit. Sadly, this isn’t always foolproof. “Even if you get the most up to date security software, it’s always going to be about a month behind the latest what we call zero date defects,” Weisman said.
  • Install malware protection: Malware is short for malicious software and it is basically anything that can harm or exploit a device. There are many different kinds. Often, it finds its way on to our devices because we click on a malicious link or open an attachment that unleashes the software. Don’t forget to protect your phone.
  • Secure Wi-Fi connections: Make sure you secure your wireless router and change the password on it.
  • Secure IoT items: It’s true. Your refrigerator may be spying on you. Many things in your home connect to the internet and can provide access to your network and other items on it which can contain personal information.

Weisman suggests taking one more step to secure your phone which is locking your number. This way, a scammer can’t transfer your phone number to another carrier.

Think about it. With many two-factor authentication codes coming to your phone, if someone had your personal information AND took control of your phone number, you wouldn’t get your codes. They would.

Locking my number was easy to do from my provider’s app. If I ever want to change cell providers, I can use the app to create a temporary  PIN to allow the change.

7. Don’t Rely on Protection Services

There are many services out there that say they will protect you from identity theft.

Weisman is not a huge fan because they don’t usually protect you. They just alert you sooner.

“I liken them to crossing a street and I get hit by a bus and someone runs out into the street and tells me, ‘Hey you just got hit by a bus,’” Weisman said. “That’s what the identity theft protection services are doing. They’re telling you sooner that you’ve been victimized. They don’t do anything to protect you from becoming a victim.”

Since most of the personal information out there comes from data breaches, phishing emails, etc., it isn’t possible to totally prevent the theft of personal information. The best we can do is attempt to control what the scammers can do once they get it.

My friends keep asking me if I stopped everything. Sadly, I cannot answer that question. The flurry of attempts to open new accounts seems to have calmed for now, but I’m waiting for the next round.

It’s a helpless feeling.

Tiffani Sherman is a Florida-based freelance reporter with more than 25 years of experience writing about finance, health, travel and other topics.

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Source: thepennyhoarder.com

Scottie Shot an Air Ball, So Can Larsa Pippen Slam Home a Sale in South Florida?

Larsa Pippen, an original cast member of “Real Housewives of Miami,” is taking a shot at selling the Fort Lauderdale, FL, home she owns with her ex-husband, the basketball Hall of Famer Scottie Pippen.

After coming on and off the market for years, the swanky spot is now back with a price tag of $12 million. And to help drive home a sale, Larsa will throw in her car collection, valued at around $1.5 million.

In the past, the NBA legend took the lead in sales efforts on the waterfront mansion, which the couple purchased as an empty lot for $1.3 million in 2000. The deluxe domicile they built in 2004 came on the market as long ago as 2009, for $16 million.

Now, Larsa is directing the effort to sell the home, which has languished on the market for years. She’s also juggling an offer to reprise her role on a reboot of the long-dormant “Real Housewives of Miami.”

In a new push for buyers, she’s filmed a video tour of the posh pad and hired Nest Seekers International to revamp the marketing strategy. The Elliott Team’s Erin Sykes and Margo Fuller at Nest Seekers International represent the listing.

It’s perhaps no surprise that the new team is bullish on finally selling the long-languishing mansion.

One big reason? The South Florida market is hotter than ever.

“Despite COVID, the real estate market in South Florida performed remarkably well compared to other major metropolitan areas,” says Shawn Elliott of Nest Seekers.

He’s handling the marketing for the property and tells us that the frenzy in the Sunshine State’s luxury market is “fueled by a surge of buyers from the Northeast, California, and Midwest who want to take advantage of Florida’s favorable climate and lack of state income tax.”

As we’ve noted in earlier coverage, this luxury megamansion is a standout. The amenity-filled spread on a double lot measures 13,500 square feet and includes a NBA basketball court, a pool with a slide, and fountains.

Known as Villa Del Lago, the waterfront residence is in the coveted gated community of Harbor Beach, and offers 215 feet of frontage on the Intracoastal Waterway. Buyers can pull up in their personal yacht, because the deepwater dock can handle megayachts measuring up to 190 feet.

The mansion was designed by Randall Stofft Architects, and luxe fixtures and finishes were used to craft the Mediterranean-style marvel.

The deluxe estate features six bedrooms and seven full bathrooms, plus two partial bathrooms, including a massive master suite with a giant walk-in closet, a coffee bar, en suite bathroom, and a private balcony overlooking the water. The second floor can be accessed by elevator.

Other resort-style amenities include a home theater, game room, fitness center, climate-controlled wine cellar, hot tub, and a commercial-grade summer kitchen.

The next owner will also enjoy membership to Harbor Beach Surf Club, a private, 300-foot beach with a pavilion and private marina, fully serviced with chairs, umbrellas and five-star club amenities.

Other perks include close proximity to the ocean, privacy, and 24-hour Fort Lauderdale Police security.

In addition to the keys to the house, a buyer will acquire the keys to some pretty sweet rides, including a Porsche 911 GTU RS, a Mercedes G63 AMG, and a Ferrari 488 Pista, the New York Post notes. Perhaps those luxury whips will finally fuel a sale.

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Source: realtor.com