Land Trust Acquisition Complications with Fannie & Freddie Backed Loans
BP Community--Happy Thanksgiving!
I am about to close on a property in Chicago (in two weeks). I just asked my lender if there are any issues with purchasing the property via land trust. He researched guidelines for conventional financing it and sent me the following:
Freddie Mac:
Effective for Mortgages with Settlement Dates on or after September 1, 2013 Freddie Mac will no longer purchase Mortgages secured by properties in which the legal and equitable title is held by a land trust (Land Trust Mortgages)
Fannie Mae:
Transactions involving Land Trusts and Illinois Land Trusts are not eligible
As such, he told me that I cannot use a land trust in in combination with the loan product I'm currently locked in with (Freddie Mac backed). I realize that I can move it to a land trust after closing, but, I would miss out on the benefit of anonymity by doing so.
It seems like I am stuck buying this in my own name and then moving to a land trust after close. Can anyone comment on this situation and give counsel on how I could have planned better to make this work?
I'd like to at least learn the lesson now so that I can use financing in combination with a land trust on my next acquisition. Thanks!