All Forum Posts by: Martin A Phillips

I'm not sure how the lender would trick the borrower by using the forms - they wouldn't typically see the loan documents until the very end of the process, at closing, which should be handled by a title company or closing attorney depending on the state.  If you're unsure whether a lender is licensed to do business, or following lending laws, you might want to consider getting representation to look everything over. 

“so if an unlicensed lender wants to trick a borrower into seeing the loan as legit by using Fannie, Freddie or FHA approved mortgage notes and filling in blanks, is that legit use of those documents?”

The highlights are mine.

Lending is not for you, @Martin A Phillips. You don’t “trick a borrower into seeing the loan as legit...” In fact, you don’t “trick” them into anything. Not only is this NOT how you do business, but you will discredit yourself as you’ve done here, in my view.

Though an astute borrower will always ask their lender where they get their money, and especially if they sell their loans, most really don’t care (though they should). You don’t seem to realize that you actually have a competitive advantage in that you will be the lender for the life of the loan and can provide accommodations larger lenders, who either sell their loans or accept investors, can’t. Borrowers appreciate this if you market yourself appropriately.

In a prior post of yours, that I participated in, I believe you indicated you were from Nevada. Here, you absolutely must be a licensed broker and also work from a brick-and-mortar office. In your case, that means using a broker to originate your loans. The last thing you need is to play the games you seem interested in and have a borrower contest your loan. I guarantee a judge won’t look at you as some, “... guy with a trust fund lending money for private mortgages.” Not when you’re trying to trick people.

Instead, try lending with some integrity. Why don’t you find a broker willing to originate your loans for you for a modest fee using their legally vetted loan docs?  (Of course, you realize that the loan docs downloaded from Fannie or Freddie are incomplete.  Yes?)  While you’re at it, you might speak to a lending attorney to learn the process in your state. This would include a discussion on licensing, usury, paperwork, and representations.

Sorry to be harsh, but lending is way too easy to play these games, Martin A Philips. I don’t know where you’re getting your advice, but you’re on the wrong track.

 It says right on the site you can use them, and others use them in case they ever want to securitize their loans they must be on this form. 

Fannie Mae Legal Documents | Fannie Mae

If you are using trust fund money to do mortgages on 1-4 units you need to be licensed and so does your company. Approval process for GSE's somewhat similar read: https://singlefamily.fanniemae.com/media/8071/display   Accounting, legal, and compliance reporting.

Forget the form you are not seeing the forest from a single sprout. 

Go work under a mortgage banker to learn more before you start this plan. 

@Martin A Phillips

Anyone can use their forms, for a private deal that is non owner occupied the deed of trust: mortgage is pretty standard but note typically has added language and other docs such as a personal guarantee or assignment of rents

FTC, CFBP enforce lending laws. FBI investigates. HUD is the mission regulator for Fannie and Freddie. Banks don't make lending laws and most all of their loans are sold on secondary market (MBS). Banks are regulated and often have their own extra rules called overlays. Employee in a bank has different license than one at a mortgage banker or broker.

A "lender" loaning money as a mortgage on residential owner occupied 1-4 units must be licensed. The company also has to have a license. (annually pass background/credit, have enough reserve money to pay fines, do annual classes...) here's the rules for CA https://mortgage.nationwidelicensingsystem.org/slr/Pages/Dyn...   there are federal and state by state rules. State where you are registered, state where property sits and federal laws must be followed.  https://dfpi.ca.gov/california-financing-law/california-fina...  You have to be licensed to quote or advertise rates, and to service a loan is a different license. There are $$ fines and jail time.   SAFE ACT.             It's not the forms that catch you - every recording is public and tracked. Every loan recorded in America is tracked by unique ID license number on certain documents. 

Some states allow business purpose loans and these are scrutinized by three Federal Agencies and also at state level.  

What state are you talking about?

It's just words. Fannie or Freddie would not care to consider this copyright infringement. HUD is the enforcing entity. HUD requires certain language on credit instruments. You know if it is the current form as they change all the time?

All lenders are required to develop and obtain forms that comply with state and federal laws. 

Again, "private mortgages" isn't a technical term or specific "thing."