Posted by Vince L (Or) on May 27, 2000 at 22:28:56:
I was the tenant/buyer in a Sandwich Lease Option. I set up an escrow payment account, but the owner gave me the wrong account number. There was no way I could repair the damage and the bank called the note due.
Vince L (Or)
Interesting tidbit about “due on sale” & FHA loans - Posted by William Bronchick
Posted by William Bronchick on May 25, 2000 at 20:47:48:
I just closed a loan today and noticed that the disclosures state that an FHA-insured loan requires that the lender contact HUD for permission to foreclose a mortgage on a property that was transferred without paying off the loan.
According to long-time investor-guru Bruce Norris, there have been NO reporting cases in which HUD actually gave that permission! Funny, because the fact that loans are FHA-insured scares many title companies, attorneys and brokers because of the alleged “federal fraud” issue (more like a wive’s tale than an issue).
Has anyone had or heard of an FHA-insured loan called due . . . ever?
Please post.
Re: Interesting tidbit about “due on sale” & FHA loans - Posted by Vince L (Or)
Posted by Vince L (Or) on May 26, 2000 at 18:49:14:
Washington Mutual called my first lease option due. I must admit in my case the owner tiped off the bank by mistake and that made me have to work faster to get the deal closed. Ed Garcia is the one whe lead me in the right direction to save it. I did however learn a few good lessons.
Vince L (Or)
William…does this mean that credit might not be a factor - Posted by Glenn(OKLA)
Posted by Glenn(OKLA) on May 26, 2000 at 16:23:13:
to take over FHA?
if so…an ENORMOUS stumbling block has just been removed
Thanks
Glenn
I’ll let you know… - Posted by Mark (SDCA)
Posted by Mark (SDCA) on May 26, 2000 at 10:11:56:
For the past 2 years, Chase has threatened to call mine due and made me jump through hoops (ie request multiple times in writing, explaining why) before they would let me rent it for another year… But so far they have (eventually) agreed NOT to accelerate it.
Mark
Re: Interesting tidbit about “due on sale” & FHA loans - Posted by ChuckP
Posted by ChuckP on May 26, 2000 at 09:44:45:
Thanks for the post. I have two “subject to” deals right now with FHA loans and about 79K equity between the two. In one of my RE classes, they pretty much said the same thing, but hearing it “from the field” is much more reassuring.
Thanks,
Chuck
Re: Interesting tidbit about “due on sale” & FHA loans - Posted by Rob FL
Posted by Rob FL on May 26, 2000 at 07:45:15:
I only violated it on one FHA mortgage. It was with Irwin Mortgage Corp and I used the land trust method. That was over 2 years ago. Haven’t heard a word from them and I did change the mailing address and the insurance.
Re: Interesting tidbit about “due on sale” & FHA loans - Posted by JohnB_NJ
Posted by JohnB_NJ on May 25, 2000 at 22:00:37:
Bill,
Interesting piece of information. No, I have never yet to date had an FHA insured loan called due. I had fleet Mortgage inquire about a Land trust and they requested the docs but I never complied and have not heard another peep out of them. That was a VA insured loan.
I recently sold one of my FHA insured “subject to” deals and I got a nice little surprise in the mail last week. A check for $785.22 from the US Treasury of the “unearned FHA insurance premium”.
Thanks HUD!!!
The check was made out to the my seller but I had a power of attorney that allowed me to deposit any checks related to the property (ie: mortgage escrow checks, insurance proceeds and any other proceeds relating to the property).
But as to the original post; nope, never had an FHA loan called due yet.
-JohnB_NJ
Re: Interesting tidbit about “due on sale” & FHA loans - Posted by Rob FL
Posted by Rob FL on May 26, 2000 at 21:02:11:
Were you the tenant/buyer while owner still held legal title? Or did you buy it “subject to” and then lease option it to someone else? Give us some details if you don’t mind.
Re: Get a good nights sleep! - Posted by Lori Samson
Posted by Lori Samson on May 26, 2000 at 24:57:01:
So, why DO we all lay awake worring about it? It beats me!