Warning: 2 Million Homeowners Can't Pay Their Mortgages!

2 million homeowners are behind on their mortgages. And that's not a rumor. That's confirmed from the Mortgage Bankers Association data. FHA delinquencies are now over 10%. Conventional loans are creeping higher too. And these delinquencies, folks, are creating more and more foreclosures. In fact, according to Adam Data, foreclosures are now up 20% year over year. And while everyone's yelling that a crash is coming, the real story could be what's happening in your city, in your neighborhood, maybe even on your street. Because make no mistake, something big is building under the surface. And when that pressure finally releases, it won't look like 2008. It'll look like an opportunity if you know how to spot it. So today on The Housing Nerd, we're going to go under the hood and look at the latest mortgage delinquency and foreclosure data. And stay tuned to the end because I'm going to show you how this could affect your town and your neighborhood. My name is Jason Ferrier. I am a realtor. I'm an investor. I've been doing it now for years in Central Ohio. And you must be aware, I am not a financial advisor. I'm not an accountant. I'm not a lawyer. None of what I'm showing you today is a recommendation to buy any real estate at all. I just want to provide you data so you can make a good decision. According to the Mortgage Bankers Association, in quarter two of 2025, the overall delinquency rate of residential properties was around 4%. And delinquency simply means that a borrower is more than 30 days behind on their mortgage payment. And let me know what you think in the comments below. Will mortgage delinquencies continue to increase? Maybe you know somebody who's behind on their mortgage. 2 million people are. And what's most troubling about these delinquencies is that FHA borrowers have the highest level of delinquency, over 10%. And that's a shame because a lot of these FHA borrowers are first-time borrowers, a lot of them lower income borrowers. And these folks, along with most other homeowners, are already stretched thin by rising inflation, rising insurance costs. And don't get me started on property taxes. Those have crushed many people throughout the country, certainly here in Ohio. Now, one of the things to keep in mind is that even though delinquencies have risen significantly over the past couple years, they're still below historical trends. In fact, according to Mortgage Bankers Association, that trend's running about 5.2% delinquent. So the fact that we're about 4% total in delinquencies is under that historical trend. But where MBA says we're in serious trouble is when it comes to serious delinquencies, actually people that are 90 days or more past due. In fact, when you look at this chart from the MBA, you could see that FHA serious delinquencies are up to 3.8%. So roughly 4 out of every 100 FHA borrowers are serious delinquent, meaning they're facing probably foreclosure at some point soon. Now, conventional borrowers seem like they're still in the driver's seat. Only 1.07% of all conventional borrowers are seriously delinquent. And they go on to say, compared to a year ago, serious delinquencies increased across all loan types. Basically, borrowers are still hanging on overall, but the cracks are forming. This isn't a foreclosure wave yet, but this is how downturns start. A small number of delinquencies that most people ignore until the numbers explode and everyone wonders what the heck's going on. And many people are thinking there should be more delinquencies and more foreclosures simply because you've got more inflation, you've got now student loans involved, and just the overall cost of owning a house has increased. Unfortunately, the government has already proven they won't let this all collapse at once. Recently, I heard another YouTuber, Melody Wright, a mortgage expert, say something I thought was very, very poignant for what we're going through right now. Watch what they do, not what they say. Well, if you looked at history, you would know the government continues to come in, interfere in the monetary system, the housing market, student loans, bank bailouts, whatever you want to call the intervene, interfere, wherever trouble pops up. Comment below and tell me, do you think the government has stopped interfering? I don't. Everyone expected Trump to hammer borrowers when student loan payments resumed. Instead, they're quietly restarting forgiveness for around 2 million student loan borrowers. In fact, on October 8th, the Department of Education said processing would happen over the next several months. But why the forgiveness now? Because the American Rescue Plan's tax-free forgiveness window ends December 31st, 2025. After that, canceled debt could become taxable again. At the same time, the big beautiful bill rewrites the way student loans are being repaid. And supposedly, they're going to be replaced with stricter repayment plans. Relief today, but tighter rules tomorrow. One of the reasons why we're not seeing a lot of foreclosures is because the government has artificially suppressed them. In other words, over the past few years, the government has turned off or kinked the hose of foreclosures. But on October 1st, they're opening that up just a little bit more to allow more foreclosures to actually flow through the system. And that's a good thing. Because again, we need foreclosures. That is the sign of a healthy market. But don't get it twisted. If someone can't make their mortgage payment, there are a lot of ways to extend and pretend even after October 1st. They've just tightened the rules slightly. But if history's any indication, if things get really bad with foreclosures or delinquencies, they're going to figure out a way to extend and pretend and kick the can further down the road. Tell me I'm nuts. Comment below. And that's the pattern. Every time pressure builds, they kink the hose. They pause payments, extend forbearance, delay the reckoning. Just picture a garden hose running at full blast. Then someone kinks it. The pressure builds. That's what's happening with the student loans and the mortgage market. The government has interfered in both cases, kinked the hose, and the pressure continues to build. But as one of my viewers put it so well, hiding foreclosures doesn't mean they disappear. When the hose is unkinked, it's going to make a mess. And that's what they're doing in today's mortgage market, folks. The servicers, the regulators, and yes, the administration continue to kink the hose, holding back foreclosures as they have been over the past, I don't know, two decades. No matter who's in office, they continue to kick that can down the road. But honestly, comment below. Are you surprised that something like this is going on? To steal a quote from Denny Green, they are who we thought they were. But it's not a new crisis. It's backlog distress that's been waiting to hit the market. Foreclosures are up 20% year over year, but that's still less than half of the pre-pandemic amount. So when that hose is released, that surge doesn't necessarily mean a collapse. It means the market is finally exhaling. You see, a healthy housing market needs a steady flow of distressed inventory, not an artificial freeze. And it's the same story with student loans. Pressure delayed, but not erased. When both those hoses unkink, it'll create a quick, messy wave, but followed by an opportunity for those that are ready. Because the question isn't whether foreclosures exist. We know they do. They should exist. It's what you do when those foreclosures hit the market. That's what matters. Now, I'm not telling you to run out and buy a foreclosure today. I'm not recommending that you buy anything, but I am telling you that these opportunities are real. They exist today. They'll definitely exist tomorrow, but it's on you to do the research and make the decision to buy or not. And remember, as a realtor and an investor, I'm always working with folks buying and selling homes. As an investor, especially, I have purchased foreclosed properties or properties that were headed to foreclosure. And you may hear people tell you, don't buy a foreclosure. Stay away. Oh, those are dangerous. Oh, you don't want to do that. Well, what's the point of trying to scare you about foreclosures if at the end of the day, they're telling you, don't buy one, just keep staying on the sidelines. To me, that is crazy. Somebody owes it to you to at least explain how foreclosures work. And trust me, I'm not an expert, but I have done it a few times. And I've rehabbed dozens of homes, many of which I've done the work myself. So I know something about buying distressed properties. And one of the free tools that you can use to find a foreclosure or a distressed property is Zillow. So if I use Zillow and just look at Ohio and all the homes that are for sale, right now it's telling me we have about 31,145 homes. So if I go into the checkboxes and the filters in Zillow search area, I can unselect basically everything except leaving foreclosures and pre-foreclosures. I like pre-foreclosures better. I'll tell you why in a second. But if I hit apply, you can see there's 229 total pre-foreclosures or foreclosures in the state right now. And so this one right here in Columbus is $217,000 they say. And here's another one. This one's actually listed for 160 grand. But if you look at the notes, it says, this is a foreclosure auction, no interior access, minimum bid, 160,000. Register and bid your price on this three bed, one and a half bath home in Columbus. 5% buyer's premium applies. So there's definitely some homework and research you have to do with these properties, but they do represent opportunities. Everyone likes to talk about foreclosures, but if you're not willing to actually take a risk, go in and look at one, maybe even invest in one, what's the use? But here's one of those pre-foreclosures I talked about. Basically, this is a notice of default. And to me, this is the best type of property to go after when you're looking at foreclosures because you can actually contact the owner prior to it going to auction in many cases. So what I do is I go into a place like Zillow and I find properties that are pre-foreclosure listed. And then I look up the owner's address information and you can find about anybody's information online now, it's just how it is. And then I write them a letter and ask them if they're interested in talking about selling their property. And that's how I bought many of my existing portfolio units off of mailing letters directly to the homeowner. Guess what folks, that works. And there's no rule that says you can't do it if you want to live in the home instead of have it as a rental. And so Zillow can be a great way to find a distressed property, especially as you see more and more of them hit the street. And something else you can do depending on where you live in the US is access your local sheriff's auction. So here in the county I live in, they actually auction off foreclosed properties by the sheriff's website. Now, I personally haven't bought a property from this site, but I have clients who have bought investment properties, even houses to live in from this site. And then they've renovated them and either rented them out or moved in and experienced awesome equity gains right up front that beat anything else that people have in the neighborhood. Why? Because they're willing to do the work. They're willing to research these properties. They're willing to do the legwork to go and buy them. And then they're willing to take on the rehab project. Again, I'm not going to give you excuses as to why you can't buy a home, why you can't invest in real estate. These opportunities exist just a matter if you're willing to do the work. Like look at this one in Crookersville. This one looks like a nicer home. Yeah, certainly better. And some of the things you got to watch out for on foreclosures is the condition. Make sure you actually drive by the property. A lot of these you can't go into before the auction. And you also need to check out the title. Have a title company run a thorough search and find out exactly what's happened with the title history and if it has a clear title. But again, I don't like chasing auctions or foreclosures. I like the pre-foreclosures. Many times these are owners trying to sell before they lose it all. Those sellers are motivated and sometimes open to creative terms like seller financing, which depending on how you do it. And again, I'm not a lawyer. I would actually encourage you to go to a lawyer and get their advice if you want to do a seller financing deal. But seller financing does exist. I've used it and it can be completely legal if you follow the rules. So I guess what I'm trying to say is everyone is staring at the cracks of the housing market. But look what's under the hood. Look what's underneath the cracks and stop waiting for the bottom. If you think prices will fall, make lower offers. Waiting is not a strategy at all. And for goodness sakes, if someone tells you, don't buy a home, whatever you do right now, but I'm going to tell you when the right time to buy is, that is crazy. Run away from that as fast as possible. And locally, you can do a lot to learn about real estate. Before I got into real estate investing or bought my first rental property, I spent six months for two hours a day, at least learning about rentals, about foreclosures, about cashflow. And I didn't just watch YouTubers. I got involved with local groups. There are real estate meetups happening right now in your area. I guarantee it that you could be part of for free and have years and decades of millionaire experience right in the room. I would also reach out to lenders, create a bank of lenders that you can go to when you actually find a deal. Develop a relationship with other investors in your area because sometimes they find opportunities that don't work for them and they may want to pass them on to you. Investors love helping new investors. I help them all the time. And network with real estate agents. I got news for you. If foreclosures explode and if distressed properties hit the market, agents will be involved. And so you may have to bite the bullet and be nice to them. The other thing I would encourage you to do is you should learn from current experienced, successful investors, not people who have never done it and are just afraid because they're going to give you all the reasons why you shouldn't do it. And if you don't want to do it, that will certainly help you. But if you really want to be in real estate, if you want to buy your first home, but you don't want to buy it like everyone else and you don't want to pay retail, talk to people who have already done it. Most rental property owners are small mom and pop landlords. They're not mega corporations. They're average, everyday, normal individuals. People like you, people like me. One way to get involved and gain some knowledge from people who are doing it now is to join a group like this. This is the school community with one rental at a time. The guy that runs this community, Mike Zuber, has decades of experience in investing. He went through the crash and he's a normal guy. And he has tons of free info on his YouTube channel, one rental at a time. But this school channel is about 70 cents a day. And inside this community, they have local meetups that people are organizing. There are investors spread throughout the country, probably just like you that are looking to try to take advantage of the incoming foreclosure wave. And then you got guys like Dion, who makes it a point to own as few rentals as possible, but still retire wealthy. He actually calls it the cheat code to wealth. Now, I'm not sponsored by any of these companies. I don't make money if you engage them at all or join the school community. I'm just giving you recommendations to get off your rear end and actually do something versus just watch doom. So you got to learn, you got to do your own research, and you got to make your own decisions. But in closing, let me ask you a question. Would you prefer more competition out there or less competition if you're trying to buy a property? Well, most people want less competition. Guess what? Less competition is here right now, today. Or maybe you want to wait until everyone knows that there's a ton of foreclosures out there and they're all trying to buy them. And what if interest rates drop? Heaven forbid they do, you will be stuck competing with many other folks, maybe even institutional buyers, because fear is not the end. It's the window. Use it. 2 million homeowners are behind on their mortgages. That's fear. But the fear creates opportunity. The question is, are you ready to act when everyone else freezes? And again, I don't care if you buy or sell a property or look at any of these websites. I'm going to keep doing what I'm doing and I'll be here through it all with you. And I hope you enjoyed this video. I hope you learned something. If you did hit the like button, subscribe to The Housing Nerd, and YouTube thinks you are going to love my next video over here, up here. It's right here. I think it's right here this time. I swear it's going to be right here this time.