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#1752497 - 10/25/12 07:09 PM Section 8 Violation????
Tryin-2-Comply Offline
100 Club
Joined: Apr 2003
Posts: 202
Hills of TN
Our mortgage division wants to do a campaign where the buyer will receive a lender credit if purchasing a home from a specific builder. We are not the financing bank of the builders properties.

I've read the FILs, RESPA and other discussions and have not been able to find anything prohibiting this (since we are not the financing bank for the builder) - but, this request makes me nervous.

Any thoughts?

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Lending Compliance
#1752519 - 10/25/12 07:45 PM Re: Section 8 Violation???? Tryin-2-Comply
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,762
Bloomington, IN
There is no Sec 8 issue as long as the lender credits are going to the borrower.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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#1752544 - 10/25/12 08:34 PM Re: Section 8 Violation???? Tryin-2-Comply
Richard Insley Offline
10K Club
Richard Insley
Joined: Oct 2000
Posts: 10,056
Toano, VA
Please ignore this if there's a case on point, but it sure looks like the builder receives a "thing of value" if a mortgage lender selectively drives business his/her way. I see this as a different case than a general promotion that is not builder-specific. In all cases, the credit to the borrower causes no concern.

Disclaimer: I tend to be ultra cautious when it comes to Section 8 because the lenders I supported designated ME as the company representative who would do the year at Club Fed if I guessed wrong! shocked

My other reaction to this arrangement is why? What makes the bank so anxious to dip into the stockholders' dividends in order to help this particular builder succeed?
_________________________
...gone fishing.

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#1752551 - 10/25/12 08:47 PM Re: Section 8 Violation???? Tryin-2-Comply
Tryin-2-Comply Offline
100 Club
Joined: Apr 2003
Posts: 202
Hills of TN
thanks!

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