‘I can barely make it’: This Nevada woman earns a decent $5K/month — but says she’s just 1 job loss away from living on the streets of Vegas. Why foreclosures are spiking in the Silver State
For Las Vegas homeowner Yolanda Perkins, the threat of foreclosure constantly looms over her head.
“The cost of living is so high, I live from paycheck to paycheck and I can barely make it,” she told Las Vegas ABC affiliate KNTV. “I make over $5,000 a month and I can not make it.”
Don't miss
Commercial real estate has beaten the stock market for 25 years — but only the super rich could buy in. Here's how even ordinary investors can become the landlord of Walmart, Whole Foods or Kroger
Car insurance premiums in America are through the roof — and only getting worse. But 5 minutes could have you paying as little as $29/month
These 5 magic money moves will boost you up America's net worth ladder in 2024 — and you can complete each step within minutes. Here's how
Perkins’ situation is one that’s becoming increasingly common across the state, reflecting bigger nationwide trends. The latest data from the Consumer Finance Protection Bureau shows 1.4% of Nevada homeowners are between 30 and 89 days delinquent on their mortgages — a number that has been trending upward since the lowest point in June 2021.
Moreover, foreclosure activity in the Silver State is climbing. Research from real estate data aggregator Attom shows through the first half of 2024, Nevada was fourth in foreclosures nationwide, with 0.19% of homes in active foreclosure, ranking behind New Jersey, Illinois and Florida. The rate is higher than the national average, where one in 794 homes are in foreclosure.
Although mortgage defaults and foreclosures are on the rise, it doesn’t mean homeowners are powerless to do anything about it. Here’s what you need to know about default and foreclosure, and what options are available to stay in your home.
Factors adding to the foreclosure rate in Nevada
Homeownership is a major investment which requires significant assets to maintain each month. According to UNLV’s Lied Center for Real Estate, the average household income for homeowners is $90,979 per year. But between inflation, cost of living data, and home sales data, that money may not have the same spending power compared to years ago.
Complicating things is the rate of inflation in Nevada — the one thing all experts agree is weighing homeowners down. Inflation is the measurement of price increases on goods and services, such as groceries, energy, and medical care compared to a previous point in time. The U.S. Senate Joint Economic Committee shows Nevada ranks 11th in increased monthly inflation costs, spending $31,369 more annually compared to the same time in 2021.
With inflation rapidly increasing, it complicates how homeowners budget for their residences. When calculating how much mortgage a homeowner can afford, the FDIC recommends homeowners budget for two to three times their annual income, with a target mortgage payment of between 25% and 28% of their monthly income. At the average income of $90,979, that puts the target price range between around $182,000 and $273,000.
Is this a realistic target price? Data from the Federal Reserve Bank of St. Louis suggests that this may not be the case anymore in Nevada. As of June 2024, the Zillow home value index for all homes in Nevada was up to $443,103 — down from the peak of $459,325 in July 2022. At the current prices, the Lied Center says nearly 1-in-4 are paying 35% or more of their monthly income on mortgage payments each month.
Read more: Car insurance rates have spiked in the US to a stunning $2,150/year — but you can be smarter than that. Here's how you can save yourself as much as $820 annually in minutes (it's 100% free)
What can homeowners do when they fall behind on their mortgage?
A mortgage can go into default when a homeowner breaks the terms of their contract, with the most common reason being missed payments. Each contract differs on how many payments a homeowner needs to miss before they enter into default.
The most current data from the CFPB shows 1.4% of Nevada homeowners are between 30 and 89 days delinquent on their mortgages, which can put them in default. Only 0.6% are 90 days or more delinquent, matching the national serious delinquency rate.
If your home is in default and at threat of foreclosure in Nevada, you have time to work with your lender to find an alternative to eviction. The process of foreclosure can only start after 120 days have passed since missing their payment. In the first notice of non-payment, lenders must provide homeowners a list of alternatives to explore to keep them in their home.
The first step towards resolving a default is calling your lender and asking for options to work with them on getting back to current. The CFPB says you should have information prepared to explain your situation, such as why you’re behind on payments, how long you anticipate the problem will last, and how much you have in current assets.
If they cannot provide you with a mortgage assistance program, assistance is still available through housing counseling agencies approved by the Department of Housing and Urban Development. A counselor can help you determine what programs you may qualify for, what help may be available from other organizations, and assist you with budgeting to help get back on track.
The good news is that for Nevada homeowners, foreclosure is the final step after a long process to help keep homeowners in their residences. By creating a budget and understanding what options are available to mitigate default, it’s still possible to achieve homeownership and stay in your home.
What to read next
Stop crushing your retirement dreams with wealth-killing costs and headaches — here are 10 'must-haves' when choosing a trading platform (and 1 option that has them all)
Jeff Bezos and Oprah Winfrey invest in this asset to keep their wealth safe — you may want to do the same in 2024
Rich young Americans have lost confidence in the stock market — and are betting on these assets instead. Get in now for strong long-term tailwinds
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
