In my opinion, the proposed HUD Rules which interpret the S.A.F.E. Mortgage Licensing Act are misguided and perhaps unconstitutional. These are the comments I chose to post on the government site which is requesting public input. YOUR COMMENTS ARE VERY IMPORTANT AND MUST BE POSTED BY FEBRUARY 16TH SO PLEASE DON'T DELAY! I am asking for your help. Please pass this information on to everyone you know who has an interest in residential real estate.
"This law was not intended to disenfranchise retirees who have invested in residential rental houses for the sole purpose of funding their retirement. Those who have worked hard to buy residential property and to pay off or pay down their mortgage debt during their income earning years should not be compelled to become licensed under the S.A.F.E. Mortgage Licensing Act in order to sell their properties and carry back the financing (to fund their retirement). The S.A.F.E. Mortgage Licensing Act which was enacted on July 30, 2008 did not preclude unlicensed owner financing transactions between a willing buyer and seller. HUD's proposed rules in Section II F mention the sales of owner occupied residences as an exception to their proposed licensing law; however, there is no exception mentioned for non-owner occupied residential property.
Section 453 of the Internal Revenue Code allows for the reporting of gain using the installment sale method. This may no longer be available for residential investment properties if HUD's proposed rule is not clarified to exclude owner extended financing.
The United States Constitution upholds and protects private property rights. Telling owners that they cannot sell their properties and carry back financing would be a taking away of those rights and would slow the sale of residential property when commercial financing is scarce, thereby reducing property values. If HUD's proposed rules take effect as proposed, retirees may have to discount their equities to sell and will have limited opportunities to invest for a safe and fair return given the marketplace today. I do not believe that this is the intent of this law."
David Tilney
Keyper Corporation
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Well, sadly all of this new licensing is costing companies and mortgage loan originators a lot of money. It is creating a huge burden on mortgage companies that is then mostly being passed down to consumers.
ReplyDelete-JK
Denver Property Management