I have an interesting case in hand! I have a client - Buyer that decided to make an offer on a FSBO property. All went fine with paperwork. Seller was OK with the deal, signed the papers and we are moving along. Here is a little info on the property: double lot, double wide mobile on permanent foundation, outside city limits.

Due to the age of the property and with it being a mobile house, I strongly recommended to my client to get an inspection. She agreed. The lender also did his job by not only sending an appraiser there but also a structural engineer. The structural engineer was the first on site and said the property was sound and looked good. He went under the house and checked everything (or so we thought) and signed off on it.

Appraiser was next! He did the same thing! Everything looks good, appraised for the sales price! OK - Good news, right?

My client decided to skip the inspection based on the word of the structural engineer and the appraiser. She didn't want to spend any more money on the subject. However, I did not feel right about the deal and since I am no expert in house inspecting and even less so in mobile homes, I asked a friend of mine that is a Building Codes Inspector to come as a favor to me and at least take a look at the roof and foundation. Well, he DID! His report: the house is not sitting on a PERMANENT foundation!!! I immediately called my client and let her know about it and of course since the Seller was already present, the inspector and I let him know about it as well! My client decided that she didn't really care about the foundation. She likes the lot and the house and wants to buy it no matter what! OK, as long as she signs off that I did tell her about the facts and recommended that she either back out or lower the offer!!! I also mentioned the fact that the bank might not finance it due to this condition!

I just got word from the Lender and neither the appraiser or the structural engineer reported that the trailer is not on permanent foundation. How could they have missed it??!! Isn't it what they get trained, licensed and paid for???? I was dumbfounded! I know if I tell the lender about what I found out, it will probably blow the chances for my client in getting finanicing, but I feel that I have a responsibility to the lender to let them know! I know we only have an agency agreement with the client only, but I feel that if the bank was to fund the money under false facts, and I was aware of these adverse facts, I would become part of this mess.

I decided to write a letter to the Lender and explained to them my inspector's findings. I recommended that since the inspector's findings were different from the appraiser's and the structural engineer's, the lender should find a third party to do a final and independent investigation before finalizing the paperwork on this deal! I made sure all parties got a copy of it and needless to say both Seller and my client were not happy about it at all. I was not happy to do it either, but I felt that it was the RIGHT thing to do!

If you are an investor or have clients that are investors, please be advised on the changes from Freddie Mac and Fanny Mae regarding financing for investment properties.

As of a month ago or so, you can no longer finance a residential non-owner occupied property through a regular 15-30 year fixed rate mortgage if you have 4 or more properties already financed, including your own residence and any equity lines of credit! It used to be you couldn't finance more than 4 properties per given year, but now that has changed to 4 properties - TOTAL!   

I found that out the hard way! I sold one of my investment properties and was getting ready to do a 1031 Exchange, just to find out that I didn't qualify for a mortgage due to having more than 4 properties financed at this time! I cannot begin to tell you how angry that made me!

You would think that the 700 billion dollars that the banks got for the bail-out, would allow the banks to approve more rather than less mortgages, especially to people with good credit, good payment history, good income and a record of running a profitable business for many years! Or maybe not! After all they need the money to pay for their CEO's Christmas bonus!

Nevertheless, make sure to keep this change in mind and advise your clients as well so they don't initiate any purchases without securing the funds and end up not getting the property and paying taxes on an uncomplete exchange! (Undeveloped land, commercial properties and residential multi-units 5+ are not effected by this change!) Also, you might still be able to secure financing through other sources such as personal loans, hard money loans, commercial loans etc.

I just wanted to take a few minutes to wish everybody a Very Merry Christmas! This is my first Christmas as a member of the Active Rain and I have to say I have enjoyed my time in the AR very much! I've met wonderful people online, I've read lots of funny, sad, smart, not so smart ;o), informative, "just because", personal, professional and many in-between postings that have become part of my daily routine. The longer I remain a member, the more I enjoy my stay and want to spend even more time in here (addicted, I know)!
Thank you all for contributing to my on-going education, for enhancing my personal and professional experiences, and for being there when I have a question to ask or need to blow of some steem! Peace, prosperity, and happiness to all of you and your families!

Have a Merry Christmas everyone! Ho! Ho! Ho!
I hope you enjoy the little musical I've included:
http://www.youtube.com/watch?v=lC9ftIE8XRQ