Mortgage lending

Private Lending Basics

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Private lending, or “hard money” lending, is a great way to deploy funds in a self-directed IRA. With interest rates approaching 15-20% in some cases and fixed payments coming in every month backed by real estate, it’s a passive investment that’s hard to beat. In this article, I’ve summarized a few key due diligence items […]

Mortgage lending

The truth about land trusts in Ohio

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In my real estate law practice, clients often ask about land trusts and how to use them in Ohio. The truth is that in my opinion these structures needlessly complicate an investor’s deal structure and don’t provide any benefits that aren’t already available with an Ohio LLC. They’re often pushed by ‘strategists’ who don’t have […]

Mortgage lending

Borrower-paid attorney fees in foreclosure? Unlawful

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Many promissory notes and mortgages contain a provision awarding attorney’s fees for foreclosing on the borrower. This even includes Fannie Mae’s uniform mortgage for Ohio. Many lenders can and do successfully collect attorney’s fees on collection and foreclosure judgments. However, as we know elsewhere in real estate law, just because the contract says you can […]

LLCs

Due-on-Sale News: Fannie Mae allows transfers into LLCs

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An enterprising investor on BiggerPockets discovered this useful nugget in the Fannie Mae Servicing Guide from 2017: Section D1-4.1, Information Relating to Transfers of Ownership Applicable to All Mortgage Loans D1-4.1-01, Determining Whether a Transfer of Ownership Is Permitted (11/12/2014) […] D1-4.1-02, Allowable Exemptions Due to the Type of Transfer Unless the previous borrower requests […]

Mortgage lending

Owner Finance: Prepayment Penalties Under $75,000 Illegal

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Investors selling property with owner finance should be aware that they’re subject to Ohio’s Consumer Sales Practices Act. This law specifically covers individuals or entities that issue residential mortgages or loans to consumers, and would squarely include investors selling property subject to a private mortgage for the purpose of owner finance. Prepayment penalties are controlled […]

Mortgage lending

Mortgage Financing Rundown

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We detailed the traditional types of financing available to residential property investors in an earlier post. To recap, when you’re about to sign a purchase agreement, it’s important to consider whether you want the property to be titled in the LLC’s name or your own personal name. Generally, it boils down to this: LLC – Commercial […]