FR-5271-P-01 SAFE Mortgage Licensing Act: HUD Responsibilities Under the SAFE Act is just one more nail in the coffin of independence: A government-issued license to sell your own property. The proposal could become law as of May 31 and directly violates the 14th Amendment to the Constitution by depriving the right of the homeowner to dispose of their property as they see fit, free of state interference without due process of law. Now that we have nearly zero access to credit through banks, and hardly anyone can qualify for traditional financing, this proposal aims to slam the door on our right to trade with one another. This is a rule which adds insult to the stamp of “bad credit” by further strengthening the provably predatory banks by rewarding them with more guaranteed customers. As stated by Roman Mosqueda, S. J.D. in his article, “Proposed HUD Rule Prohibits Seller Financing Without License Except for Family or Own Residence,” the proposed rule impairs obligations of existing contracts protected by the Constitution in the following ways:
- The contract is the law among the parties. A property owner has the right to sell his or her property, including seller-financing to enable a buyer short on cash to consummate the sale.
- Seller-financing likewise enables a seller to sell his or her properties faster, and earn income during the duration of the promissory note being financed.
- The proposed rule would impair obligations of existing contracts in cases involving contracts to sell with seller-financing, lease with option to buy with seller-financing, and other similar contracts.
This overreach of the SAFE Act has exactly the opposite effect as what the Act was intended to cover. HUD’s own Web site, states that the SAFE act was a major component of HERA (The Housing and Economic Recovery Act of 2008), which “constitutes a major new housing law that is designed to assist with the recovery and the revitalization of America’s residential housing market.” This new rule actually hinders individual homeowners from aiding in their own recovery and gives more power to the very same mortgage industry that has destroyed the housing market in America. By requiring mortgage broker licensing, the individual’s right to the use of his own property is now strictly limited. Furthermore, bank financing simply is not possible in many cases, even beyond the “bad credit” equation, or tight lending policies — homes in flood areas, investment homes, or multiple homes owned but not occupied by the owner or the owner’s family, for example. Even when these homes are owned free and clear the property still is not yours to do with as you wish.
The following statistics posted on ActiveRain by a specialist in owner financing and lease options illustrate the vast limitation that the new rule puts on the real estate landscape across America:
- These rules would prohibit even partial seller financing – i.e. a “seller second.”
- According to HUD’s “Residential Finance Survey” in 2001, roughly 40% of all non-farm residential properties in the US are owned free and clear.
- An estimated 6 million Americans own a property other than their own primary residence.
- An estimated 4.5% of Americans own three or more properties, many purchased solely as investment properties.
- 40% of non-owner occupied residences are mobile homes which are more difficult to sell with bank financing.
- Approximately 5% of homes in US are for sale or for lease… seller financing may be key to liquidating this inventory.
As with all government legislation designed to intimidate those considering non-compliance, here are some of the more tyrannical points sourced from The RescueUS Project:
- You cannot receive a license if you’ve committed any felonies – ever – meaning you’ll never be permitted to self-finance your property under any conditions if you’re a felon of any kind.
- Mandates fingerprinting to finance your own property.
- Threatens a $25,000 penalty for owners who fail to obey HUD’s rules.
- Forces owners to complete 3 hours of Federal Law training.
- Mandates owners complete 2 hours of federally approved “ethics” training.
- Requires that owners complete 2 hours of lending standards training.
- Puts upon all self-financing owners and their prospective buyers dramatically higher costs and decreased opportunities to engage private property transactions.
- Stops you from exercising your own constitutionally protected private property rights until the government approves your conduct – and charges you for it.
- HUD grants itself authority to summon you any time it chooses for a host of reasons.
This is yet another front in the war waged by the oligarchs against an independent America. Our Constitution is our protection against tyranny, and it is being systematically dismantled one Amendment at a time. History has taught us that once personal property rights are violated, everything that follows is exponentially worse. Contact HUD and make your voices heard that this is an unacceptable violation of our very clear rights under the 14th Amendment. It might already be too late as this rule was pushed through at the last minute and the official deadline for comment has passed, but please contact your Senator and contact your Congressman to express your disgust with this blatant assault on the real economy and your individual rights.