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FHA Suspends 90-Day Seasoning Rule as more First-Time Buyers Flood into the Market.

February 17th, 2010 1:12 AM

In a move that surprised even the most attentive among our ranks, on January 15th, 2010 The US Department of Housing and Urban Development waived a set of requirements related to foreclosure sales that had have often shut out FHA buyers “from buying affordable properties,” said FHA Commissioner David H. Stevens. “This action will enable our borrowers, especially first-time buyers, to take advantage of this opportunity.”

Sellers, many of whom are investors who have learned to capitalize on the many opportunities in the foreclosure market, now have a new market of buyers that are currently a major part of the housing resurgence, courtesy of the First-Time Homebuyer tax credit which was extended through June of this year. Coupled with this Suspension of the 90-Day Seasoning Rule and the First-Time Homebuyer credit, those investors who are able to make moves on foreclosed properties in a weary market may be poised for big success in 2010.

The waiver will take effect on February 1, 2010 and is effective for one year, unless otherwise extended or withdrawn by the FHA Commissioner. In an effort to protect FHA borrowers against what they deemed the predatory practices of “flipping where properties are quickly resold at inflated prices to unsuspecting borrowers,” this waiver is limited to those sales meeting the following general conditions:

All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.
In cases in which the sales price of the property is 20 percent or more above the seller’s acquisition cost, the waiver will only apply if the lender meets specific conditions.
The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program.

While the government has still failed to admit the legitimacy of our business in whole, they have certainly taken a step in the right direction with this action as they create an excellent opportunity for community conscious investors to assist in the renovation and resale of thousands of foreclosures across the country.

Click here to view the Waiver of Requirements of 24 CFR 203.37a(b)(2), or visit www.NationalREIA.com/LegislativeInfo or http://www.hud.gov/ for more information.

Information provided by the National REIA

Posted by Radoslaw Zimnoch on February 17th, 2010 1:12 AMPost a Comment (0)

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HUD has proposed to eliminate ALL seller financing unless the seller lives in the home or becomes a licensed mortgage originator

February 17th, 2010 1:14 AM

The following information is extremely important!
HUD extends timeframe for comments regarding proposed SAFE Mortgage Licensing ACT Rules
HUD has proposed to eliminate ALL seller financing unless the seller lives in the home or becomes a licensed mortgage originator. The proposed HUD Rules interpreting the federal SAFE mortgage act can be viewed at www.regulations.gov Use the search parameter “HUD” and the keyword “safe”. Please review and comment regarding the impact of this broad interpretation of the law.
“In addition to establishing HUD’s responsibilities under the SAFE Act, through this rule, HUD proposes to clarify or interpret certain statutory provisions that pertain to the scope of the SAFE Act licensing requirements, and other requirements that pertain to the implementation, oversight, and enforcement responsibilities of the States. HUD solicits comment on the proposed clarifications and on the regulations proposed to be codified.”
How YOU can help:
We learned about the publishing of the rules very late in the process… and the deadline for comment is upon us. The deadline was originally today, February 16th, but was just extended to March 5th. We still desperately need for thousands of REIA members across the country to go on record with HUD on this issue. We will be working to try to affect this law in other legislative ways, but cannot hope to gain traction unless our members have clearly communicated that they are opposed to this portion of the rules. This is your chance to be counted on this issue.

PLEASE SUBMIT YOUR COMMENTS TO HUD! We have very little time to flood this system with comments.

Follow these simple steps:
1. Logon to http://www.regulations.gov You will see two white boxes for searching
2. On the left box labeled “Document Type”, pull the menu down and select “proposed rules”
3. On the right box labeled “Enter keyword or ID”, enter “safe mortgage”. Then, press search
4. Locate the blue search result “FR-5271-P-01 Safe Mortgage Licensing Act: HUD Responsibilities Under ….” To read the rules, click on this title. You will be taken to another page. You will see “views”. You can click on PDF file or another symbol which will show you the rule document online.
5. On the right of the screen, click on “submit comment”
6. Complete the form providing required information and your comments and then submit
What do you say?
Say what you feel, but say it politely! The message should include that you would like the definitions in the proposed rules to be changed so that private individuals can originate and service loans on properties they personally own. Some ideas from others:
• bank loans are not available on some types of properties
• the tight lending climate has made bank financing “out of reach” for many
• seller financing is an “age old” tradition based on private property rights
• these rules would prohibit even partial seller financing – i.e. a “seller second”
• according to HUD’s “Residential Finance Survey” in 2001, roughly 40% of all non-farm residential properties in the US are owned free and clear
• an estimated 6 million Americans own a property other than their own primary residence
• an estimated 4.5% of Americans own three or more properties, many purchased solely as investment properties
• 40% of non-owner occupied residences are mobile homes which are more difficult to sell with bank financing
• approximately 5% of homes in US are for sale or for lease… seller financing may be key to liquidating this inventory

Posted by Radoslaw Zimnoch on February 17th, 2010 1:14 AMPost a Comment (0)

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