👋 Happy Friday! Our offices are closed today for Veteran’s Day (Observed). We’re also moving to 1901 West Colonial Drive over this three-day weekend so it’s going to be “busy” but not very “productive” for a few days.

🔌 Electric 🌼 Daisy 🎪 Carnival 🦄 (AKA: EDC) is in Orlando this weekend to add to the activities nearby. If you’re downtown and see a bunch of scantily-clad, neon-studded fairies and other 20-somethings dancing around to music thumping at 180 beats per minute, just go with it. The ticket and concessions sales from this one event pay the Camping World Stadium operating costs for the entire year, so Orlando is more than happy to host the event year after year.

1 big thing: TransUnion’s Tenant Screening Missteps

The CFPB and the FTC recently penalized TransUnion’s rental screening arm to the tune of $15M for failing to make sure their tenant reports were accurate.

Why it matters: Many property managers and real estate investors rely on these reports; if they’re not accurate, good tenants could be denied—and bad tenants could slide in through the cracks.

  • The subsidiary responsible for tenant reports, TransUnion Rental Screening Solutions, neglected the accuracy of eviction records.

  • This led to wrongful denials and possible financial harm to impacted consumers.

Define “neglect.” There were a few checkboxes TransUnion Rental Screening Solutions failed to meet, including:

  • Eviction records that did not reflect dismissals

  • Erroneously-duplicated eviction records

  • Incomplete information provided surrounding inaccurate information

The result: People were unfairly denied housing. And when renters became aware of inaccuracies, the company made it difficult for them to request corrections.

So, a hefty fine. TransUnion will pay $15M for screening inaccuracies and $8M for issuing bad information.

For years, TransUnion responded with misleading responses to consumer queries regarding security freezes and locks on credit reports. This led to more bad outcomes for property owners and managers who relied on TransUnion for accurate data.

Hence the court order. The proposed court order should force TransUnion to stop these practices and take immediate action to boost record accuracy.

Yes, but: these aren’t isolated incidents.

  • Over the past seven years, TransUnion has faced similar enforcement actions indicating a pattern of misconduct, negligence, and misleading communication practices.

  • The Consumer Financial Protection Bureau (CFPB) has taken action against TransUnion in the past for deceptive practices surrounding the company’s subscription plans.

The bottom line: If we use tools like TransUnion’s Rental Screening Solutions to make decisions that impact people’s lives, and our profit margin, we must stay informed about them. Accuracy, fairness, and transparency are in everyone’s best interest.

2. Unlocking Opportunities with Assumable Mortgages

Assumable mortgages — programs that allow buyers to take over a seller’s existing mortgage — may be the golden key today’s would-be homebuyers are looking for.

How it works: A staple of the real estate industry in the ‘70s and ‘80s, assumable mortgages allow a buyer to assume the seller’s loan terms.

  • This includes the seller’s interest rate, which is often significantly lower than rates available through new mortgages.

With today’s interest rates for new homes hovering around 8%, the idea of taking over an existing mortgage with a much lower rate is an appealing option for many buyers.

Yes, but: Not all mortgages are assumable. Most are primarily available for loans backed by the government through the VA, FHA, or USDA. Such loans constitute a little over 20% of active mortgages.

  • If a buyer qualifies for this type of mortgage, that could unlock affordable homeownership.

  • Many real estate professionals realize this and advocate for assumable loans for their buyers.

  • Sellers of qualifying homes are advertising this feature because they realize it gives them a competitive edge.

One wrinkle: If the seller is a VA loan holder, allowing a non-veteran to assume the loan could affect the seller’s eligibility for future VA loans — a noticeable con amid the pros mentioned above.

Nevertheless, if both the seller and the buyer qualify and are interested in pursuing it, an assumable mortgage can provide many benefits. It’s just essential to understand the nuances of these types of mortgages.

The bottom line: Remember that “assuming” a mortgage is not the same as taking a property “subject to” a mortgage where the lender doesn’t formally approve the conveyance, allowing the buyer to step into the seller’s shoes.

  • Assumptions are great for those who plan to live in the home as their primary residence, while “investors usually use subject-to” transactions.

3. Catch up fast

  1. Debunking the 7 myths of turnkey investing. Bigger Pockets

  2. The top five markets for projected price declines (3 in FL) over the next year. CoreLogic

  3. 30-year mortgages see largest one-week drop in a year, revising mortgage demand. The average monthly payment is now only $250 higher than last year’s. HousingWire

  4. The number of consumers seeking delinquent mortgage counseling has surged 90% since last year. DS News

  5. Commercial and multi-family loan applications drop 49% since last year. The M Report

4. Pic of the day

Illustration: Joe Seagle

Commitment to one’s vision is a trait of great visionaries.

Those who succeed have heard of the “zone of disappointment” and know how to overcome it through grit and tenacity.

  • It’s that space between our expectations of what success looks like versus the reality of what it actually takes.

We are told that success will come in that straight line if we get one percent better each day, continuously rising a little more each day. But that’s not how it works in reality. There are setbacks each day.

  • Some ideas don’t work out as planned.

  • Money (profit) is slow to build; employees quit, people get sick, and so on.

So we skip along the bottom for a while … sometimes for years … with setbacks and disappointment.

Yes, but: Those who believe in their vision and execute strategies to achieve it will succeed. A vision without a strategy and execution is just a daydream.

The hardest part is powering through that zone of disappointment, which requires sacrifice.

  • Sometimes, it means sacrificing relationships with friends and family members who are naysayers or unsupportive of your vision.

  • Often it means sacrificing time spent with those who are supporters.

The bottom line: As I’ve written before: “Name it to tame it.” Recognizing when you’re in the “zone of disappointment” and naming it is the first step to powering through it.

We hope you found this helpful — any feedback is appreciated and can be shared by hitting reply or using the feedback feature below.

Be on the lookout for our next issue! 👋

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