Club Chaos Agents - All Things Hollish, Wacked, and Jacked

head_left_image

Is it a "SAFE" act? Not anymore! Flippers Beware!

First, I must proclaim that I am NOT an Attorney and in no way am I attempting to give legal advice.

 My question is, "how SAFE is it to owner finance in Texas?"  Deb Brooks on Texas House Bill 10 Lake Conroe Real Estate

I received a call from a friend yesterday and she was asking me about the potential of OWNER FINANCING her Texas home. She explained that a couple had viewed it and said their credit was not up to par and would the Seller consider holding the note. This answer was a no-brainer. It was a big fat "NO".  Their home is still mortgaged which caused the obvious problem.  ARMS LENGTH MORTGAGES ARE ILLEGAL IN TEXAS. In fact, if you go into a contract stating you will finance the home for them and you consider it a sale, it is my understanding that your note holder will call your note due and payable immediately!!!  If you've sold the house they want their money!

BUT WAIT THERE'S MORE! HOUSE FLIPPERS BECOMING A DYING BREED...

As Realtors, and Mortgage Pros and all of us that are involved with this business it seems we have to pay attention to LAWS OUTSIDE OF OUR PROFESSION to stay on top of things. Yes, yes, we all know this but with the changes being made every day it's tough to keep up.

 Are you familiar with the 2010 "SAFE ACT" IN TEXAS HOUSE BILL 10?
“Secure and Fair Enforcement for Mortgage Licensing Act”)

I was not familiar and came across it quite by accident. What an eye opener it is.

The bill states that, Under the current code, owner-financiers must have a Residential Mortgage Loan Originator license from the Texas Savings and Mortgage Lending Department.Texas House Bill 10

Once upon a time we were allowed up to 5 transactions a year...kind of like flipping cars. This restriction is just unimaginable!  It seems to me that if the sales took place at a legal Title Company with legal paperwork, the government shouldn't be able to tell us what we can or cannot sell!!!!!! Come on now! They are now saying not even ONE owner finance per year with a few exceptions.

EXCEPTIONS:

If you own the home free and clear and it is your homestead.

If you sell to a family member.

Or, use a Third Party Mortgage Originator...there goes the profit!

AND IF YOU DO IT ANYWAY ARE THERE REPERCUSSIONS?

Oh my, YES. If you are caught doing it anyway you are subject to a $25,000 fine, you may owe damages to the Buyer and well, isn't this all bad enough?

So, FLIPPERS BEWARE!


 

                                                                                                   Please subscribe~       
**********************************************************************************

 

 

Texas Home Search on FaceBook

Check out my website at: www.debs-realestate.com.

 Some photos attributed                                     

 

 

 

 

Comment balloon 8 commentsDeb Brooks • March 01 2012 02:28PM
Is it a "SAFE" act? Not anymore! Flippers Beware!
share
First, I must proclaim that I am NOT an Attorney and in no way am I attempting to give legal advice. My question is, "how SAFE is it to owner finance in Texas? " I received a call from a friend yesterday and she was asking me about the… more
Home is where the heart is…
share
Home is where the heart is… As Professionals we have the drill down now don't we? We question, we qualify, we place but are we actually doing the best for our clients? Are we finding out where their hearts are? Couples, singles, families,… more
Change… it's more than what you find in your pocket. Just Thinkin'…
share
It is a daily guarantee. Nothing we do, nothing we know, and no one we know will remain the same. Philosophy is one of deep thought, "educational concepts" that haunt each of us even if we never had formal education. Whether you realize… more
Real Estate and the Question of Courtesy Listings… Get Over Your…
share
Thinking back a few years ago I remember the attitude of… "It's my listing… don't touch it! " I had progressed into the new millennium like a comet hitting earth for an old fart like me. It all seems to me to be a normal understandable… more
I Made 400. 000 Points? Wowser…
share
Oh my, I just thought this would be a mountain that I couldn't climb. I remember my first 50, 000 points that seemed like it was never going to happen. I quit worrying about the points and simply began voicing my thoughts, business views, listings… more
Deb Hired an Assistant! Her name is Reecie Sue…
share
Mom hired me as her assistant. She could see the many talents I possess. It takes talent to recognize talent… right? I do all that I can to keep her organized and when she gets a little down… more
Once You Publish, Google Has it Forever!
share
ActiveRain, I want to thank you for that. I received a comment from a post I did back in 2008 that was found and reviewed today. I saved a worms life. I helped to save a life today! Okay, a moth. I saved a life and I am tickled about it! I have to… more
When The Lights Went Out In Kindergarten!
share
Kindergarten. This is the time Charles Buell has asked us to write about. I was very lucky to have a wonderful and stable early childhood. This is probably why I am still quasi-sane today. Now, this statement is not open for debate. Sorry. .. more
GOOD NEWS! "Painting With a Twist" in The Woodlands Texas!
share
Last night my girls and I painted with a Twist at Painting With a Twist and it was a whooping, marvelous, fantastic and unbelievable time and experience. We had a ball. It's inexpensive and special classes are offered for you and the kids! … more