No investor, investor, landlord, landlord’s representative, property manager, or property owner should be short of work in trying to make sure the LA accountability provisions, HR 3915, are not abused by anyone. You, as an investor or a landlord, know that. As the LA-regulated real estate investor, we know if a provision is abused, the investor or landlord suffers a tremendous financial loss. This article is a must-read for all recent investors/landlords/property managers.

Before the law was passed, private lenders were free to require very little in terms of documentation. Although lending procedures were generally quite easy, the new laws eliminated, basically overnight, the ability of many private lenders to originate loans. This means the percentage of loans resulting from private funding has dramatically shrunk.

Homeowner Education was pretty much non-existent and could be taken care of through the previous broker/title company relationships. The new Education Act requires all lenders that solicit loans for owner-occupied properties in California to provide education for their borrowers. That’s not just for the lenders that do sub-prime lending -there yet are nearly 40 million California homeowners who don’t fit the FHA qualifying guidelines. Imagine where this could lead. what happens if a lender starts or outsources loans through several brokerages instead of just one? Everyone getting into a home in California knows the hard work lays ahead of them. New regulations are a huge change, from completing underwriting work to reporting on loan documentation to helping borrowers understand how their loans will post in certain loan categories. This all creates a whole new stream of new workers (and their families) to the already workforce of real estate agents, home inspection companies, appraisers, etc. They most certainly need more education.