Posted by Michael Morrongiello on April 10, 2011 at 24:30:33:
Lee:
Fannie Mae loans are underwritten and documented to VERY strict guidelines. There is FULL Income verification, certain debt to income ratio requirements, appraisal and property condition requirements, flood insurance (if need be) requirements, and then the conforming loan documentation and disclosure requirements itself(TIL
s., GFE’s, RESPA, and so forth)…
These loans are readily and easily securitizeable.
Also banks do not always get 100% or PAR for their loans, even FANNIE MAE grade paper.
A Private Seller Financed Note is NOT a Fannie Mae loan… its is and will always be consider NON CONFORMING PAPER. It also will be discounted.
With STRONG Credit, a STRONG down payment, and a premium charge for the interest rate over prevailing CONFORMING bank rates, a seasoned seller finance non conforming Note can be set up so that the discount is minimized but it still will be discounted.
Michael Morrongiello