“Seller-financed property purchases are ‘predatory'” — And this financial columnist thinks all seller financing involves land contracts: “the protections offered by the mortgage foreclosure process don’t apply to seller-financed properties, which are also called “land contracts.” What an ignorant statement! READ MORE: http://www.marketwatch.com/story/toxic-home-financing-contracts-should-get-more-oversight-legal-group-argues-2016-07-14
4 thoughts on “More Attacks On Land Contracts”
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Bill, You are being too kind by calling the writer of this article “ignorant”. Talk about creative writing without having a clue about what you’re writing about. Dale Morrison, CCIM
The underlying thrust here is to hand more control over to the fed gov in all facets of our lives and I see this continuing to happen until the states start standing up and yelling about it and start electing senators and reps with guts enough to speak up.
Of course the Left’s justification is its claim that the poor need the financial protection only the feds can provide and under this guise continues to shoulder the states out of their way.
Trump has said his first actions will be to repeal Obama’s illegal exec actions and that’s why DT’s getting my vote.
Like many things land contracts are neither good or evil. They are neutral. It is the terms in the paperwork that determines if someone is being set up or not.
But since the “law center” has a obvious political ax to grind maybe we should suggest they look into the terms in the land contracts used by Bill and Hillary Clinton in their Whitewater Development. I am sure there will be plenty of “predatory” clauses in those docs.
The author forgets that many of the advantages of land contracts are low down payment, low payments, cheaper and faster origination. The law center is going after the large private equity groups who bought thousands of homes during the bust and resold them on land contracts. They don’t mention that often these homes were “sold” for less money than renting. Yes that’s right they were often sold with as little as $500 down and $300/mo payments. In the same areas, rents are often 2-3x as much. Yes they need to do all their own maintenance, taxes, etc, but the reality is it gave people an opportunity to own a home where the banking sector didn’t serve (<$50k homes) for people with poor credit. What's wrong with offering below market rent with an opportunity to own a home? Who out there believes you should own a home after putting $500 down and paying $300/mo for a year or even two? The Law Center apparently does… the fact that everyone in finance knows is that these lenders would prefer the cash flow stream than getting the property back.
And the fact is that the majority of those land contracts DID perform, because it was a sweet heart deal for most people who bought at those 2012-2013 prices, when the banks weren't lending. There's 5 positive stories for every negative one, but that doesn't make news.