We owner finance around 12 properties a year and usually use an RMLO for these sales since we are selling to an owner occupant buyer. Recently I had an investor who is interested in owner financing from us for investment purposes. He already owns his home and has two other rentals that he bought with owner financing. He buys properties in his personal name for investment purpose. My RMLO is saying I still need to go through the same process with him. I thought Dodd Frank/Safe Act was to protect owner occupant buyers and that it would not apply to investors since they should be deeded savvy. Is my analysis correct? Thanks.
You are correct. The federal rules do not apply when owner financing to an investor. Just have him write and sign a letter confirming he is purchasing for investment purposes to document your file.
What if I'm proposing to a seller to offer seller financing to me and they are not investors? Do they need to hire a rmlo? Would it be in their best interest? I'm guessing no based on your answer to the previous question but thought I'd ask anyway. Thanks
Investor to investor if you are going to be running the property out, I would write on a piece of paper to the seller that I never intend to live in the property as per Dodd Frank
If the seller is a residential owner and they are doing seller financing to you when you going to live in it as a primary residence, then they generally fall under an exclusion if it's a primary residence and they're only doing one deal every 12 months
For what it's worth, I have an RMLO under write my TBers for my lease-option assignments because I want to seller protected in case the tenant buyer brings the seller to court
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