Insurance & Tax increases have KILLED CASH FLOW

[Constance Chambers]

Yes the Title is a little Click baitey.. but i feel we are not seeing enough attention being given to this important realization in many markets.   Honestly, this applies to primary mortgages and investment properties, whether financed or not. I included the cash flow portion, because we are an investment minded community. 

As a new investor, or homeowner, knowing how your county or city (if in the city limits) responds to the PP of your investment in regards to triggering a new FMV "assessment" (which is a joke honestly) is imperative when evaluating cash flow and/or affordability. I do not see many investment or affordability calculators (like bankrate, zillow, or BP) including this in their formulas. Our lender never once brought up the possibility of this happening the very next year! (they just want a note that pencils out pretty in order to sell...but thats another issue for another day) Even the HUD disclosure paperwork lenders required to send 2 new potential buyers do not mention this potential increase.

for example: 5 % down on new home., 2021. Our property taxes doubled, causing our monthly mortgage to increase by X% in 2022. Next, 2023 our Home Owners insurance rates XXXincrease!, which caused another unforseen X% increase in our monthly mortgage.(no claims) We live in North Middle Ga. I can not imagine what coastal rates are like. I know the difference in PITI , im trying to keep this post simple, because as a newbie i had no idea this could happen. I always heard "mortgages stay the same for 30 years". As a new home owner, i absolutely did not understand this could price me out of my monthly payments within a year of buying my home in 2021. Is this the new ARM??

I bought my 1st primary in 1994, we started investing in 2018. I have purchased and financed 8 primary homes over 30 years, and 11 investmenet properties since 2018. I do not recall a lender ever "warning" me the PITI will / can increase next year and to be prepared. My adult children, who are now buying homes, are also not being informed of this possibility, i am the informed parent making them aware of this.

Is this not predatory lending in disguise? 

one of our residential investments, SFR, that was once cash flowing really great...now barely meets the mark because of the increase in the PITI, in Georgia. i know how to respond to these changes, am ready to pivot markets etc. but many new investors will have no idea. Can we add this to the calculators on BP somehow, perhaps it is triggered when the zip code is inputted. Awareness needs to be brought to the forefront for new investors, unless we just dont want them to know.

yes my spelling sux, im not here for a grammer check.   (im a nurse x 30 yrs,  so i write with abbeviations)