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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Re: Why panic? - Here's why Posted by jmac on February 13, 2010 at 9:26 AM In Reply to: Why panic? posted by Rick, the Probate Guy on February 13, 2010 at 8:59 AM : I question if many of the posters who are so worried about this are even affected by such a bill's passage. : First off, how many have ever bought or sold property using seller financing? : Second, if buying, it's the seller that would be concerned that you'd turn them in (and why would you?) : Third, if licensing were ever to become an issue, and you were Selling on terms, just get licensed. That would be the cost of being a pro and perhaps and advantage as a barrier to entry for those that refused to train, test and qualify. : However, this is all a lot of worry over nothing. : Direct quote Courtesy of fellow dealmaker Terry Vaughn: : "F. Individuals Not Subject to Licensing Requirements : Notwithstanding the broad definition of ``loan originator'' in the : SAFE Act, as noted in HUD's Commentary, there are some limited contexts : where offering or negotiating residential mortgage loan terms would not : make an individual a loan originator. The provision in the definition : that loan originators are individuals who take an ``application'' : implies a formality and commercial context that is wholly absent where : an individual offers or negotiates terms of a residential mortgage loan : with or on behalf of a member of his or her immediate family. : Accordingly, this proposed rule would provide in Sec. 3400.103(e)(4) : that such individuals are not subject to State licensing requirements. : The commercial context implied by the taking of an ``application'' : is also absent where an individual seller provides financing to a buyer : pursuant to the sale of the seller's own residence. The frequency with : which a particular seller provides financing is so limited that HUD's : view is that Congress did not intend to require such sellers to obtain : loan originator licenses. Accordingly, this rule would provide in Sec. : 3400.103(e)(5) that such individuals are not subject to State licensing : requirements." I have bought and sold with seller financing and found it very crucial to closing the deal in those cases. I also frequently buy seller financed notes. (something which also will go with the dinosaurs if this passes). The main thing is if seller financing must be done by a licensed broker and follow RESPA/HUD laws, the deals will be much more complicated and probably not get done at all, since there are very strict rules on documenting income verification. And I would probably not buy notes without a whole new process to see if they were properly originated as per the 100's of pages of new regulation they would now fall under. These new regulations have already caused most private lenders to abandon the owner occupied loan business. Getting your license is the easy part, the hard part is learning all these new laws and qualifying your buyer under RESPA/HUD laws. My position is if its not broke, dont fix it and seller financing has worked well since before banks or HUD were even in existence. By accepting this law, you are giving up your property rights to sell your property, and becoming more dependent on banks. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : : I question if many of the posters who are so worried about this are even affected by such a bill's passage. : : First off, how many have ever bought or sold property using seller financing? : : Second, if buying, it's the seller that would be concerned that you'd turn them in (and why would you?) : : Third, if licensing were ever to become an issue, and you were Selling on terms, just get licensed. That would be the cost of being a pro and perhaps and advantage as a barrier to entry for those that refused to train, test and qualify. : : However, this is all a lot of worry over nothing. : : Direct quote Courtesy of fellow dealmaker Terry Vaughn: : : "F. Individuals Not Subject to Licensing Requirements : : Notwithstanding the broad definition of ``loan originator'' in the : : SAFE Act, as noted in HUD's Commentary, there are some limited contexts : : where offering or negotiating residential mortgage loan terms would not : : make an individual a loan originator. The provision in the definition : : that loan originators are individuals who take an ``application'' : : implies a formality and commercial context that is wholly absent where : : an individual offers or negotiates terms of a residential mortgage loan : : with or on behalf of a member of his or her immediate family. : : Accordingly, this proposed rule would provide in Sec. 3400.103(e)(4) : : that such individuals are not subject to State licensing requirements. : : The commercial context implied by the taking of an ``application'' : : is also absent where an individual seller provides financing to a buyer : : pursuant to the sale of the seller's own residence. The frequency with : : which a particular seller provides financing is so limited that HUD's : : view is that Congress did not intend to require such sellers to obtain : : loan originator licenses. Accordingly, this rule would provide in Sec. : : 3400.103(e)(5) that such individuals are not subject to State licensing : : requirements." : : I have bought and sold with seller financing and found it very crucial to closing the deal in those cases. I also frequently buy seller financed notes. (something which also will go with the dinosaurs if this passes). : The main thing is if seller financing must be done by a licensed broker and follow RESPA/HUD laws, the deals will be much more complicated and probably not get done at all, since there are very strict rules on documenting income verification. And I would probably not buy notes without a whole new process to see if they were properly originated as per the 100's of pages of new regulation they would now fall under. These new regulations have already caused most private lenders to abandon the owner occupied loan business. Getting your license is the easy part, the hard part is learning all these new laws and qualifying your buyer under RESPA/HUD laws. : My position is if its not broke, dont fix it and seller financing has worked well since before banks or HUD were even in existence. By accepting this law, you are giving up your property rights to sell your property, and becoming more dependent on banks. [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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