Posted by lostBob on July 16, 2003 at 10:51:49:
is it the new buyer or seller? I have heard that you can sell the contract back to the seller for a fee. Where would this fee go on the hud 1?
Anyone run into seasoning issues? - Posted by Dan-IN
Posted by Dan-IN on July 14, 2003 at 21:30:44:
Anyone run into seasoning issues with lenders when doing double closings or assignments?
Re: Anyone run into seasoning issues? - Posted by Sean
Posted by Sean on July 15, 2003 at 12:18:22:
Yes, MOST lenders want some sort of seasoning, generally at least 6 months… but not all. Some will do 3 months or less, least we did was about 1 month of ownership.
You just have to find the right lender, also the right broker who will go to bat for you. We had to fight for that 1 month refi, but the house was georgeous we bought it way below retail, were only into it for 28 purchase + about 4k repair, it was worth 60k, it was immaculate… once the bank saw the pics they had no problems.
Re: Anyone run into seasoning issues? - Posted by Rob FL
Posted by Rob FL on July 15, 2003 at 08:24:41:
Yes.
There are plenty of creative ways around seasoning issues though. The key is to simply get the buyer and seller to be the only names on the contract. Your assignment fee can get paid as an expense on the closing statement.
Re: Anyone run into seasoning issues? - Posted by Kristine-CA
Posted by Kristine-CA on July 14, 2003 at 23:16:02:
I have run into seasoning issues. Most of the properties I have wholesaled were rehab properties that I sold to cash buyers or rehabbers with hard money loans. The few I have tried to sell retail did not fly because of seasoning. And assignments would not help in these cases as the lender wanted to see the borrowers name on the contract. One time I went so far as to have the contract re-written between the buyer and seller (after collecting my assignment fee). And still I was “investigated” by Countrywide because of potential loan fraud (their explanation).
By the way, this was all before the recent FHA rulings, etc. The lenders were already on the look out for this. And I’m not talking about FHA loans, either. The seasoning issue will now affect most SFH loans in my opinion.
I am pretty much staying away buyers that need any kind of lender funds besides their own sources of hard money. I’m sure there are ways around the seasoning issues, but I have found that there are enough cash buyers for what I’m selling.
Hope this helps. Sincerely, Kristine
Re: Anyone run into seasoning issues? - Posted by Dan
Posted by Dan on July 15, 2003 at 08:58:14:
Rob,
Could you please explain how the assignment fee is written as an expense on the closing statement? Or, what would the assignment fee be classified as, on the closing statement?
Thanks,
Dan
Can you tell us how they investigated? NT - Posted by Chris
Posted by Chris on July 15, 2003 at 24:21:58:
NT
Re: Anyone run into seasoning issues? - Posted by Rob FL
Posted by Rob FL on July 15, 2003 at 12:47:58:
My first recommendation is to find a flexible, open-minded closing agent.
Now what you call your fee is up to you. If “assignment fee” won’t work, you can call it a consulting fee, referral fee, etc. You can also make it as some sort of lien payoff if you agree to this in writing with the seller. Or if you have a real estate license, this can be a commission.
Be open-minded with this. New lenders don’t care who gets paid off on the seller’s side at closing; as far as they are concerned, there could be 5 mortgages and 20 liens against the property. But sometimes they make an issue if the seller and buyer’s names don’t match or if the buyer has a bunch of extra fees.
Re: Can you tell us how they investigated? NT - Posted by Kristine-CA
Posted by Kristine-CA on July 15, 2003 at 24:31:52:
Chris: it was really simple. They called me and told me that they were investigating me for potential fraud. Pretty smooth, huh?
Now mind you, I’m already off the contract. There is no assignment as they rejected that. So they had a contract that was written between the seller and the buyer. Pretty clear cut. They then explain to me that since they sell these loans in bulk at a discount, they need to determine if the loan will be paid off too soon (no profit for them). I mention to them as nicely as they can since that I’m not the borrower, they may want to investigate the buyer/borrower, not me. Good point, they say. And, in my opinion, there is a big difference between potential fraud and the lender checking out the potential profitability of the loan.
It was absolutely ridiculous. What triggered it was that orignally my buyer had an assignment of purchase contract. They said in no uncertain terms that assignments were not permitted. So, even though we fixed that, they still pursued the issue as if there was an assignment.
We’re talking Countrywide here. I’m sure it’s worse now, since the new FHA rulings.
Sincerely, Kristine
Re: Anyone run into seasoning issues? - Posted by JoeS
Posted by JoeS on July 16, 2003 at 05:50:57:
I agree with both Rob and Houserookie. Here in NY the “contract Police” are on the prowl…if you get paid on the Hud-1 for anything out of the ordinary they are climbing all over you! I have found it best to simply sell my Contract to Purchase, which is assignable. This will eliminate 99% of any investigative reporting! My 2 cents.
Re: Anyone run into seasoning issues? - Posted by Houserookie
Posted by Houserookie on July 16, 2003 at 01:41:11:
I agree for the most part except the portion about
replacing “assignment fee” for consulting fee or
referral fee. Some states require licensing when giving or receiving referral fees or when offering consultation in a real estate transaction for another and for a fee.
In MN, each violation can cost up to $10,000 and be charged with a gross misdemeanor.
There are many ways to avoid title seasoning but charging a fee for a service in a real estate transaction is not one I recommend.
Cheerz,