In the absence of any mention of either “installment sales” or “credit sales,” the Mortgage Reform and Anti-Predatory Lending Act (also known as HR 1728) has no effect on carryback transactions.

HR 1728 is focused on tightening the screws on lenders originating and then packaging loans to be sold on the secondary money market: not on real estate transactions involving extensions of credit. Whether or not these lenders are merely farming willing (but unable) buyers for the sole purpose of floating empty paper on the secondary money market is of great importance to not only the health of local economies, but also to the greater U.S. economy and, by extension, the global economy.

The federal government’s response to unscrupulous and lightly-regulated mortgage lending practices is HR 1728, which only gives the government greater regulatory power over lenders of money and NOT over individuals conducting carryback transactions. Again, the purpose of HR 1728 is to ensure paper hitting the secondary money market is not worthless. The impetus to eliminate or to cripple carryback financing is nowhere in this bill. Let the ghost of the myth die, now.

From: HR 1728