All Forum Posts by: Dave C.

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 Now, I would like to offer another opinion regarding regulators. I understand the frustration people feel over having to change what they are doing to accommodate changes in both society and the law. I also understand that people become even more frustrated when they learn they need to pay money and invest time to make the correct changes. However, getting angry almost never solves anything and often interferes with logical thinking.

In my opinion, regulators don't feel threatened by owner financing. They do find the task of regulating it difficult because of the number of people engaged in it. There are many aspects of it they don't really understand, and as a result, we end up with illogical legislation, especially in the secondary legislation.

If one looks at the classic Lonnie Deal through the eyes of a regulator and much of today's public, at the very least, they see a potential for consumers to be taken advantage of. Remember that people have different points of view on many things. I can, and have, made a case for pay day lenders because I truly believe them to be necessary. Some of those reading here would feel they are nothing more than legal loan sharks. While I might not fully agree, I do understand that many people would feel the high rate of failure to complete and end up with a home constitutes "churn" and is in fact predatory.

In the workshop for Lonnie Dealers we just held in Chicago, we spent considerable time explaining how to eliminate unplanned churn to the attendees and why it is actually more profitable to eliminate high levels of non performance by their customers. Everyone there, after we explained how to eliminate most of it, and ran through the numbers comparing both methods was enthusiastically in favor of changing many aspects of their operations to lower the non performance of their customers because it is more profitable, and it lowers the chances of unfavorable publicity and regulatory attention.

I guess we could go back to 1939, even before that, for the reasoning behind financial regulatory policies, let's not. I agree with Ken and small business, in fact, the bigger business gets the more I dislike them......generally. That gets off topic.

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There are plenty of us here, myself included who would love to go back to 1939 - The days before the 30 year mortgage, and many of the onerous regulations that made the purchase of a basic need(shelter) far more complicated than need be

Originally posted by @Bill Gulley:

Anyone starting a forum thread on BP doesn't "own" that thread. Folks that want to hear only what they want to should probably open their own site, then you could boot those who disagree with you off the site or just hit delete. 

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Anyone starting a forum thread should reasonably expect constructive feedback from those willing/able to give it, not trolling naysayers with an agenda.

This is a clear example of anger on the part of an operator. The backtrail of the SAFE Act and the Dodd-Frank Act is clear. The SAFE Act came to be to cover up POTUS and Congressional Action that led to the meltdown in the first place. The Clintons and their staff revived a program that well-meaning but clueless Jimmy Carter had created, (CRA) and Reagan shuttered was revived by the Clinton team to save their administration from a major recession on their watch. Ironically, Barney Frank was a major cheerleader for the program as well. When it all went to Hell in the meltdown, the politicians worked to bury their part in it by blaming first banks and then mortgage brokers for the problem. Thus, we had the SAFE Act.

The Dodd-Frank Act should have been named the Liz Warren Act. She was the instigator and the brains behind it, which included the CFPB. Of course, she was the first head of the CFPB and hand picked her successor before running for, and winning a US Senate seat. She has no friends among business people, because she hates the idea that anyone would ever make a profit.

The Obama administration and staff are the ones who hate small business. They hate small because small is harder to regulate and tax. The current mayor of Chicago when he was still on the Obama staff once told a meeting of bankers that one of the goals of the Obama administration was to force the consolidation of all banks (through regulation) until there were only 10 very large banks left.

I have no idea which "certain consultant" Dave is referring to but I would personally love to see Dodd-Frank and the SAFE Act disappear. RCG was a very profitable consultancy prior to the passage of all these laws, and took far less investment, and far less time to run. The customers and clients we had then were far happier, and so were we. My personal workload has tripled, but if we were not there to help, there would be many entities in huge trouble right now.

All of that said, I am not a socialist, or even a fiscal liberal. I believe that people should be paid what they are worth and that when I buy something of value, I should expect to pay for it. I get to decide when I give away my knowledge for free and when I expect to be paid.

We subsidize and publish a newsletter monthly that goes out by email for free. We only ask that people that want to subscribe answer a few questions. According to email forwarded to me by Julie Anderson, who is responsible for the newsletter, a certain individual recently refused to answer those questions and then got angry when she told him the newsletter was not available to him. Many of you are subscribed to that newsletter so you know we simply want to know who you are and how to reach you if we chose to.   

Sometimes even simple things get complicated.

 Dave - What makes you think I am not making loans? While it is true I and my partners sold the bulk of our loan portfolios early in 2013 for $1.05 of face, I still have loans working, and new ones originating in communities I am invested in.

I am curious as to what you mean by my posts being rather informative, although not in the most direct way. If I can improve my communications, I am always open to doing so.

 ROTFLMAO!  

Do you guys hear that at some flag burning party. 

The reason Dodd-Frank reached out to seller financed real estate transactions was because of the predatory, cheating, low life, scamming vultures calling themselves "investors" ripping off the public, not all investors, but most doing SF deals. Because they had no clue to what they were doing, or if they did, they were just greedy cons.  The public yelled and law markers heard them. Now, we can all suffer for the acts of those others. 

Everyone wants to avoid the blame.   

Now, if that dang EPA would go do something else, I wouldn't have gotten so much rain here that has killed my flowers and it's my constitutional right to have flowers in my yard!!!! Darn government bunch!  :)

Ultimately, Dodd-Frank is un-Constitutional, communism at its finest and serves no legitimate purpose. Its only purpose is to further institute communistic state totalitarian rule in the U.S. and interfere in commerce. 

We do seller financing that is compliant with Dodd Frank.  We have a licensed originator that pulls credit, sends truth in lending, etc.  All borrowers have proved "their ability to repay" because they have performed on a lease with the same payment for 6 months.    We verify their income and job status when they close.  Every closing is performed by an attorney.  We have a complete file on each buyer that could be used in case a borrower files a counter suit against our foreclosure.  We also use a licensed loan servicer that sends monthly statements and calculates payoff etc.

No attorney will verify that we are completely complaint because Dodd Frank has some ambitious rules.  Also, there is no case law that I know of yet.  However, we believe we have mitigated our risk as much as possible.  The reward of seller financing single family over renting our weighs the risk.  We get nice down payments and our buyers are responsible for repairs and maintenance.  The largest benefit here in SC is the property tax savings for owner occupied houses, which saves as much as two thirds in some cases.

I have not seen a single post on BP about anyone, as a dealer, doing seller financing after Dodd-Frank. If anone is doing it and they are compliant, they spent good money to get compliant, I doubt they will just dump their compliance program on the internet.

That leaves the others, who might be doing it, may be think they are compliant, but I really doubt it as compliance is over the pay grade of small investors/dealers, fix and flippers, or small park owners. So, if you do get a reply, it's probably going to be wrong. Good luck :)