OK,
I’ve been working on this
for a couple days and Owner
Financing is something that is needed and I
think
it can be a great tool for sellers. But Representative Brad Miller (D)
of North
Carolina introduced a bill
HR 1728 that basically makes it so the
average home
owner can’t sell their home on owner financing any more than once every
three
years. Here is a link to read the bill and see its present status HR
1728.
Here is what I see presently. I work with a lot of people that are upside down in their homes because of the current market. Owner financing is a way they can sell their home and potentially keep themselves from getting a foreclosure on their credit, or if they have equity, a way to make money like the banks do, and to give people a chance to buy that normally can’t through the normal channels because of situations like mine. I make my money from commissions. I would require a stated income loan. I could make one million this year and next year make ten dollars. Banks don’t like that when they are lending you close to a half million dollars.
I have met many people that have bought and sold many homes on owner financing. It is a choice. Unlike the banks, it is a risk. If the buyer defaults, they may get back a damaged home and they aren’t going to be bailed out. But, if the sale goes well, they can make an additional $100,000 - $200,000 on the sale of their home, if it goes the full 30 years. The bill is trying to stop predatory lending, but is it really? Most of these people that I know are just trying to get in to a home. They have the down, but don’t like to deal with a bank for whatever reason. They understand what interest they are paying, they also know that they can claim that on their taxes, so are they really losing?
But,
here is why this scares
me and it isn’t because I will lose business, because more than likely
I won’t.
It will just shift, as the market always will. Sellers
will find a way
to sell
their home. You see the real reason this scares me is because the
government is
once again setting up another law that is telling private citizens that
they
can’t sell their home as they see fit, they have to use a third party.
(Banks)
Now, on the surface they say this is to protect buyers, but is it
really just
another way to protect banks, that are now government owned.
The government is getting
into your lives more and more each day as
they pass
more and more laws to regulate what you can and can’t do.
Each one is
slowly
taking away your freedoms, your civil rights. You think they will stop
at this
one, and even though I am a real estate agent and this could benefit
me, what do
you think the next step is? Could they outlaw people from selling FSBO?
(For
Sale by Owner) I think they certainly could propose this next, and even
if I
believe it will put money in my pocket, I disagree with it 100%. I
think people
need to have the right and the ability to sell their home on their own,
if they
choose to.
The government is slowly taking away your civil liberties, one by one, and getting into private business. Every time the government takes over another business and says it is for the good of the country, we are once step closer to the government not allowing private business to even exist in this country. Over the past 20 years, country after country has disappeared that once had their systems set up that way. What makes you think our government could run it any different? We are not too large of a country to fall, Rome thought they were safe and look what happened.
Some people believe the government should run businesses. But ask yourself this, what is the one thing that government has ever had their hands in that was able to run smoother and more efficiently than the private sector has? I’ll give you a hint… the answer is NOTHING! If you said the military, I will have to correct you and remind you in the 1700 our PRIVATE military overran the English governments arm with 1/10th the man power of the English.
So, don’t forget that our country is still free and every time you vote to have one person’s liberties or choice taken away, you are one step closer to them taking yours.
Todd Clark - Broker / Sales Coach
Palazzo Realty Group
Phone: (503)524-9494
Fax: (503)622-8739
Todd Clark and the Friendly Home Team
Knipe Realty
Todd@IFoundYourNewHome.com
Phone: (503)524-9494
Fax: (503)622-8739
I am a licensed Realtor who specializes in Washington County, Oregon and also work in both Clackamas and Multnomah Counties including the cities of Aloha, Beaverton, Canby, Clackamas, Gladstone, Gresham, Happy Valley, Hillsboro, Milwaukie, Oregon City, Sherwood and Tigard.
All information contained in these posts are copyrighted and cannot be used without prior written approval authorization from the author me Todd Clark. If you are looking for an outstanding agent please give me a call I would love to help you with all your real estate needs.
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Todd, it's all too true that we are coming closer and closer to nationalization in home financing. Some pundits think we're already there.
Todd --- this is utterly ridiculous ---surely, this won't pass --- I'm so ready for new power in Washington -- oops, we have to wait, don't we? This is a great post, Todd. I'm going to flag it for a feature -- and I am going to reblog it. Thanks.
This is just an absolutely bogus bill that won't hold water in a courtroom...unless .....the judge is.....Na.
If this mindless bill gets traction, A list of all representatives who supports it must be compiled. I can't imagine it getting through the Senate, but you never know. I don't know this wingnut from my state. I'll make the call to my rep. prettty scary stuff indeed
Todd
What is Brad Miller thinking? The next thing he will do is say that sellers can't participate in commercial seconds for assistance. He needs to think more "conservatively" and realize that the present government is hanging out bail out money like never before, and if a seller can sell on a clandestine term more power to them. Which reminds me; if we are hurting as real estate agents will they send us a couple million to help with our investments?
Todd,
God help us!
Liz,
You're totally right: "this is utterly ridiculous" and totally naive: "surely, this won't pass"
Through a friend of mine I was involved with an Iranian investor he felt the same way about the Iatolla Komainee. He was blown-up along with his ship!
Who would ever believe America would willing go Communist?
Bill
Todd, I can't understand what the purpose of this is. It's not like there is a barrage of homeowners doing seller financing! We have two deals with owner financing and one has closed. I hope this isn't passed. We need to contact our Congressmen and say "ENOUGH!"
Sharon
PS The link didn't work. ~S
Featured @ Club Chaos
This scares the crap out of me. I like owner financing, especially if you have a history with the person and their family. I'm paying off a deal right now where we turned out doing each other a favor. I got to purchase 3.3 acres near my relatives and our fields are back to back with each other. Very cool deal. If they do this, a lot of people would possibly miss out on getting land for a small down payment and reasonable monthly payments. This person split up 16+ acres into plots. If that rule were in effect she wouldn't be able to sell the rest of her subdivision because there's a cap on how many she could do in a short time span. That seems anti competitive to me. The guy across the way has 50 acres we are hoping to one day get a piece of. That may never happen if they adopt this. Farmland owners would have a hard time with this... I am having a hard time with it...
Todd:
I bought my first home with owner financing many moons ago. 14 years later I sold it and was able to start investing in real estate with the equity from that house. I was 23 and new to the country when I bought it. I would have had to wait who knows how many years to buy a home without this real estate investor who sold everything on lease options. Tere
Todd: Thanks for the warning (I guess) ;-)
A different recession and market down turn... I had my first home, and now I have 3 small kids... Other things were going on in that neighborhood, but long story short, it was time to move... I put the house on the market, but it was taking too long and I made an agreement to purchase a home we loved on the otherside of town based on getting mine sold. This was back in the day when your word and a handshake were enough.
Anyhow... I took it off the market... Then a couple showed up that really liked the place and it suited them far better than me. We worked out a lease purchase and I carried them for 2 years so they could essentially rent to own and they finally cashed me out. Admitted it scared me big time, but I went for it because it was what was needed for my family. I also had a lot of wonderful people to help me out including the sellers...
I knew what the risks were, accepted them, and tried as an individual to make a dream come true. AND, I did it... We should be allowed to fail, and succeed. We don't need the fed's in everything we do! Thanks for the post, much appreciated...
Rene'
Rene, that's really neat. My Dad helped his renter buy the home they were leasing from him. The bank were giving them a hard time and contacted my Dad who actually yelled at the man over the phone that his tenants had never been late once. "Give the man his mortgage," was an order, not a suggestion. Pop was mad blunt about it. I think it shocked the banker. I laughed when I heard they approved it the same day! That was a fave vacation kitchen moment (LMAO). I never quite looked at banks the same after that. ;-)
The Government is going over board with the new rules. If they had spent a little time a few years back we wouldn't be in the situation we are in currently.
This one is almost as scary as all the other...wait its our government at its finest..oh wait, its our government at work..oh wait its our government,
We need to get to work and get anyone we've ever known to owner finance, to get to work writing, emailing calling, whatever.
Todd - Your analysis is absolutely correct. If they only followed Pres. Coolidge's advice "It is more important to kill bad bills than to pass good ones... See that the bill you recommend from your committee are worded so that they will do just what they intend and not a great deal more that is undesirable. Most bills can't stand that test." Neither can HR1728 - bad bill... bad law.
LOL @ Deidra. Too funny and so true!!! The Gov has been making me a bit nervous with their we can fix everything mantra. Universal solution: throw money at it after we make a new house committee. News flash: No you bloody can't because we haven't printed enough and those electronic credits don't mean squat if China says pay me what you owe... They love our debt. They're our new financial landlord. Are we spending ourselves out of being a superpower?
Founding fathers demanded Gold and Silver back every buck. What knucklehead went against the constitutional framers and embraced credit? Federal Reserve rings a bell. Why would they fix the mess they started? Just sayin...
Todd - I have a response from our NAR rep that I will be posting here in a bit. According to them, there is not a lot to worry about at this point.
Todd, I know we talked about this on the phone and you should be scared. It already passed the house, that is 1/3 the way to becoming a law. People who aren't taking this serious are very foolish as it is the first step to the governemnet taking away all your feedoms.
Despite people telling me not to worry about this, I can tell you we do need to. It has already passed the house where NAR should have stopped it. But, it has gotten passed them and could easily sneak its way to the Presidents desk. I will be giving another great example from one of my sellers this week, why this is such a bad idea.
Todd,
One of the things that really irritates me about this, aside from the obvious messing with our civil liberties is the attempt to continue to disassociate folks from one another. In other words, it appears that the more government pressure applied it is like we are being ripped apart, neighbor by neighbor, from one another. We are more than capable of connecting, but the ability to do so and work things out on our own is being mangled by government intervention.
It's a scary thing when you are taught not to trust your fellow neighbor.