Posted on 07/28/2011 9:52:58 AM PDT by Bill W was a conservative
The Federal Reserve Board on Tuesday requested public comment on a proposed rule under Regulation Z that would require creditors to determine a consumer's ability to repay a mortgage before making the loan and would establish minimum mortgage underwriting standards.
The revisions to the regulation, which implements the Truth in Lending Act (TILA), are being made pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act. The proposal would apply to ALL CONSUMER MORTGAGES(except home equity lines of credit, timeshare plans, reverse mortgages, or temporary loans).
(Excerpt) Read more at federalreserve.gov ...
That is a contract for deed. Not quite the same as a mortgage but it depends on what is is................
According to a buddy of mine, a wholly unreliable source, the Federal Reserve (who I used to think didn’t care much for the comments from people like me)has extended the comment date deadline to JULY 29 - tomorrow. I have also called my Congressman, the thoroughly conservative Mick Mulvaney asking him if he has any room in his garage for a cot for me.
Oh, never mind, I just saw the 5x language.
BTW, that’s easy to get around for those who buy 6 or more houses/year and sell with owner financing: simply set up 2 or more separate LLCs or Limited Partnerships (maybe better with different people running them) to do the same thing. Each one does 5 or less transactions per year.
Since it is your business, I suggest you read it.
I don’t read it as eliminating your nitch, but you will have some required disclosure forms to complete.
http://www.fdic.gov/regulations/laws/rules/6500-1800.html#fdic6500226.31
I am not a lawyer or pretend to be. But I come here to share my opinion only. That an $2 will get you a cup of coffee at some places.
We were able to undercut the bank interest rate, provide a nice income stream to the elderly owner of the house so she could move into assisted living without a big tax hit and pay down the principal much faster.
We owned the house in seven years (of abject poverty) and were able to pay cash for our farm simply because no bank got rich at our expense.
This is why the banksters wish to make it illegal.
I agree, this is just a set up to take away the right to personally finance property. Owner financed property notes are generally NOT sold. By forcing this onto the banking system they have a new source of loans.
even worse since only fannie or freddie will be doing the private home loans this is just another government grab ala student loans.
Don’t worry, Ma’am. You’re just a little bit pregnant.
“They came for my neighbor who had done more than five seller originated financings last year, but that was OK, because I took back paper on fewer than five properties I sold last year.”
Definition of a Kulak: peasant with more than two cows and one day laborer.
Definition of Enemy of the State: man who sells and takes back paper on more than 5 properties in a year’s time.
Yeh, I know, a little melodramatic.
How are they going to enforce all this? In South Carolina, you need to settle RE transactions through an attorney.
” How are they going to enforce all this? “
All RE transactions, in order to be legitimate, must involve, at some point, a County Recorder of Deeds - simple enough to add the criterion that any transfer of deed must have the lien-holder of record from an ‘approved’ list....
Since it is your business, I suggest you read it.
I don’t read it as eliminating your nitch, but you will have some required disclosure forms to complete.
Oh, yes, the forms. Yes, sir, I have them right here...with my identification papers and licenses to buy and sell real estate.
Look, pal, the very fact that the pointy headed Bolsheviks see any sort of regulatory role at all in private transactions with debt creation is the problem.
(v) A person regularly extends consumer credit only if it extended credit (other than credit subject to the requirements of § 226.32) more than 25 times (or more than 5 times for transactions secured by a dwelling) in the preceding calendar year. If a person did not meet these numerical standards in the preceding calendar year, the numerical standards shall be applied to the current calendar year. A person regularly extends consumer credit if, in any 12-month period, the person originates more than one credit extension that is subject to the requirements of § 226.32 or one or more such credit extensions through a mortgage broker.
From what it seems like, yes.
I know of a few bankers who view real estate contracts as “theft” from them.
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