Thank you to Dyches Boddiford, Elmer Diaz and National REIA for sounding the alarm and organizing vitally-needed action on this issue . . .

Pete Fortunato recently brought this Bill to my attention.

It has already passed the House of Representations and has been sent to the Senate. If it passes in its current form, it will restrict owner financing to once every 36 months (HR 1728 Sec 101(3)(E)). While this may not be much of a problem when we get owner financing from sellers, it severely restricts our ability to sell with owner financing.

Though the bill mainly deals with amendments to Truth-in-Lending for mortgage brokers and banks, this one section could reap havoc. This could limit not only your sales where you take back a mortgage, but _your lease-options and land contracts as well_.

Here’s the latest version of the Bill: http://www.govtrack.us/congress/billtext.xpd?bill=h111-1728

All owner carryback financing should be exempted from this bill. As one commentator noted, if this is left as is, it is a taking of private property rights. We can wait for someone else to fight it, but as for me, I am contacting my Senators today to let him know what I think. I suggest you do the same.

You can find and contact your Senators here: http://www.senate.gov/general/contact_information/senators_cfm.cfm Keep it short and to the point, but let them know your thoughts! Pass this along to your investor friends.

Dyches Boddiford

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2. How to get Fannie Mae financing on an investment property!
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http://IndyRealEstateInvestor.com – Hola folks, Lee Smith here. I am a Real Estate Investing Junkie from Indianapolis, Indiana.. Jon decided to hire me on as an author(and occasional proofreader of his posts) for his blog(see episode 29). We have little time before he wisens up and kicks me from the boards, so onward we go! Lot of my articles will be more midwest oriented, but definitely can be pulled over and used in New Jersey and elsewhere….

My real estate investing lawyer, Matt Griffith, hit me up last night about a new Fannie Mae program that allows investors to get financing on some of their REO properties… This comes from a local(Indianapolis) mortgage broker, Mickey Brooks (317 218.0283), who has the contacts to get deals done in a couple of states nationwide, so give him a call, and if he can’t help you, he can prolly refer you to someone who can! Make sure to tell him I(Lee Smith) told you to call! I LIKE it when mortgage brokers like me!

“Dear Valued Partner,

As we enter 2009, the crisis in the financial markets seems to be the top story on every news channel. But many of the reporters and so-called pundits don’t understand what really happened, what’s happening today…and what may happen next.
That’s why I’m excited to tell you about a series of articles I’m creating to put an end to the confusion once and for all! In these easy-to-understand articles, with help from many resources, I explain in layman’s terms exactly what caused the current financial crisis, what the almost daily news reports really mean – and what to be watching for in the near future. The content for these articles comes from various services that I have invested in to stay up to date and educated, in order to always best serve as your trusted advisor. It’s important to me to stay on the leading edge as a professional, and when I saw these resources, I wanted to make them available to you as well. I’ll attach basic stories behind the crisis for your review, to help you better understand what happened, why, and where we’re going from here. The few minutes you spend reading them will open your eyes to what very few experts truly understand.

As your trusted advisor, I’m committed to doing whatever I can to help you understand what the current economic situation means for you going forward in 2009.
Give me a call if you want to discuss strategies for strengthening your financial future in the weeks and months ahead.

Fannie Mae HomePath Financing Program
Fannie Mae has just released a new program called HomePath to help consumers buy and finance many of their REO properties. All FNMA REO properties are not eligible for HomePath financing. Only those properties listed at the following web site www.homepath.com with the HomePath logo qualify for this program.

Mortgage Financing The benefits include:
• Low down payment and flexible mortgage terms (fixed-rate, adjustable-rate, or interest-only)
• You may qualify even if your credit is less than perfect
• Available to both owner occupiers and investors (Primary, Secondary, Investment)
• Down payment (at least 3 percent) can be funded by your own savings; a gift; a grant; or a loan from a nonprofit organization, state or local government, or employer (2% Seller Maximum)
• No mortgage insurance
• No appraisal fees
• Also eligible for HomePath Renovation Mortgage (see details below) (Primary Residence Only)

Available only on homes you make your primary residence and offers these benefits:
• Financing to fund both your purchase and light renovation.
• Low down payment and flexible mortgage terms (fixed-rate or adjustable-rate).
• Down payment (at least 3 percent) can be funded by your own savings; a gift; a grant; or a loan from a nonprofit, state or local government, or employer.
• No mortgage insurance.
• Renovation funds are borrowed as part of the purchase financing and held in escrow until the renovations are completed.
• Renovation Costs limited to 20% of the “as repaired or completed” value or $30,000, whichever is less, and renovations must be completed within 3 months of closing.

About Fannie Mae Homes

• Why does Fannie Mae have properties for sale? Fannie Mae works with all of its partners to help homeowners prevent and avoid foreclosure; however, sometimes it is unavoidable. When foreclosures occur on mortgages in which Fannie Mae is the investor, our goal is to sell properties in a timely manner in order to minimize the impact on the community.

• What kinds of properties are available in the Fannie Mae HomePath database? Fannie Mae’s HomePath database includes only properties that are owned by Fannie Mae. There is a wide selection of homes, including single-family homes, condominiums, and town houses — located in a variety of neighborhoods. The number, types and the sales prices of the homes that are offered for sale may vary substantially. Many of these homes are relatively new; however, older homes are offered in some areas. Some homes may require repairs.

• How is buying a home owned or managed by Fannie Mae different from other home purchases? Usually, when you buy a home, you deal with a seller who lives in the home. Fannie Mae has acquired these properties through foreclosure, deed in lieu of foreclosure, or forfeiture. When buying a Fannie Mae-owned home, you should know the condition of the property, as explained in more detail below, the cost of any needed repairs, and the steps in the loan qualification and closing process before you enter into a purchase and sales agreement.• Has Fannie Mae fixed everything in the house? Fannie Mae may make some repairs to properties to increase their marketability; however, the buyer should be aware that other repairs may be needed. Fannie Mae sells each property “as is,” which means that the buyer accepts the property “as is.” Fannie Mae is not responsible for fixing any problems after settlement. Even if the house has fresh paint, brand new carpet, new appliances, perhaps even a new roof or siding, it doesn’t mean everything in the house is new, or even works. Fannie Mae does not warrant or guarantee any work that may have been done on the property, whether as part of its efforts to sell the home or pursuant to conditions in the purchase contract. Where a home warranty is available, you may wish to buy it at your own expense. You should also consider hiring a qualified professional to inspect the property, whether it has been repaired or not. Hiring a home inspector is a recommended practice, no matter what type of home you buy.

• What can you tell me about this house? If Fannie Mae knows of any hazards on properties we own or market, we disclose this information through our real estate listing agents. However, we may not have been informed by the previous owner of all hazards. We encourage you to have the property inspected by a professional before you buy.

• What type of sales contract does Fannie Mae use? Fannie Mae uses a state-specific real estate purchase contract and a real estate purchase addendum for our properties. If there is anything in the document you don’t understand or aren’t comfortable with, you may want to contact a real estate attorney, the real estate sales professional who has listed the property, or any real estate professional of your choice to review these documents with you.

• Do I have to use Fannie Mae’s selected title, settlement, or escrow companies? No. You may designate the title, settlement, or escrow company of your choice, subject to the terms of the contract.

• Will Fannie Mae accept an offer contingent on the sale of my house? No, Fannie Mae will not accept offers contingent on the sale of your current home. Other types of contingencies will be considered on a case-by-case basis.

• Why does Fannie Mae require a lender’s prequalification statement before negotiating a home purchase offer? Fannie Mae wants to be sure that prospective buyers will be able to complete the sales transaction, including obtaining financing when needed. Prequalification allows you to see how much house you can afford and the mortgage amount you may be able to qualify for before you make an offer on a home. It also helps you focus on homes in an affordable price range. A loan prequalification doesn’t mean your loan is approved. You must apply for a loan separately, after you are prequalified and your purchase offer is accepted.

• Does Fannie Mae provide special financing? Special financing is available on many properties through HomePath Renovation Mortgage.

• Can I buy a house directly from Fannie Mae without going through a real estate sales professional? No. Fannie Mae depends on the expertise of local real estate sales professionals and accepts offers only through our real estate listing agents. You may work with any real estate sales professional to submit an offer to the real estate agent who has listed the property.What happens if Fannie Mae gets more than one offer? All interested parties may be asked to submit their best offer in writing though the listing agent no later than a specified date and time. Fannie Mae may accept or provide a counteroffer that we determine to be in our best interest. Fannie Mae is not obligated to accept any offer submitted.

General Mortgage Lending Terms
(Underwriting conditions may change on a per transaction basis)

Related posts:

1. Can you use the 8k First Time home buyer tax credit as downpayment?
2. Urgent Politcal Action Needed By All Real Estate Entrepreneurs To Defend Private Property Rights! HR 1728
3. Sam Bell Web 2.0 Real Estate Investing Domination – Episode #34

This is the Short & Simple Story of the Crisis Of Credit created by a guy named Jonathan Jarvis. This is an awesome video!!! A clever animation explaining the credit crisis and the journey of a subprime mortgage.

Please leave some comments because I am interested in your thoughts on this.

NEXT WEEK IS SPECIAL GUEST WEEK See you tommorrow!

Related posts:

1. Can you use the 8k First Time home buyer tax credit as downpayment?

In this episode we are at the New Jersey 2009 Mortgage Brokers Convention in Atlantic City. I wish they had it in June or July not March we could have gone swimming!

Anyway, it was still worth it. Got to meet a lot of new people and saw some old friends too. Oh yeah and one of us had to sneak in even though we bought tickets….that was funny

So you may be asking yourself, your an investor, why would you take the time to go down to the mortgage brokers convention? Well its because there is an abundance of untapped seller and money lead sources in conventions like that. Not to mention after the  financial collapse of most lending institutions mortgage brokers really know how to party!

I hope you enjoy! Please leave me some comments! Share this with friends! Join up on the friend connect! See you soon! JZ

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