For years now I’ve been fighting for my life because of Dodd Frank legislation. Dodd Frank made it illegal for me to obtain a mortgage on a farm and business under development, I already owned outright and debt free! The USDA then denied me a farm loan to keep my farming operation in business, expand it, and continue development because my house was too big. My 100% equity was effectively ineligible for leverage. Contrast that with the Financial institutions that brought the house down while they were leveraged as much as 70 to 1.
Today I had a discussion about my issues with it on twitter, that along with many other impetus of the moment, bring me to wana share the lost opportunities Dodd Frank is currently causing my family and friends. The featured Image on this page is a graph of the Sub Prime bubble Wall Street created igniting Dodd Frank Legislation. Note: they grew sub-prime lending 600% and Securitization of them 900% leading up to the Financial Collapse.
First you need to know a little about who I am and what I’ve done in my life. At ten thousand feet look at my about cbjulian page, but, for this blog post, I want you to know these things.
First My mother was a construction bookkeeper I grew up working on construction sites. My brother is a builder, realtor, real estate broker. My brother in law is a builder. I grew up surrounded by construction. From 1972 to 1987 as I worked my way through college and an accounting degree. I worked all kinds of jobs mainly in construction, but also as a commercial fisherman in Alaska. I’ve worked on and run framing crews. Electrician crews, trim crews, done plumbing, hung sheet rock, painted, laid brick , hardwood floors, and tile, installed cabinets and appliances and farmed an Apple Orchard.
Second I’m no dummy – I’d never, have survived more than 15 years in finance and finance technology services at Bank Of America from 1987 – 2004, if hadn’t some basic skills. In support of this below you’ll find a link to my resume and two links to some of the recognition I received while working at Bank Of America. Please note my career progression at Bank of America.
Third From 1995 to 1996 I built the house pictured in this slide show with funding from BB&T after I had purchased the lot. I worked my butt off that year every night, weekend and holiday on this house trying to do as much of the work as I possibly could myself. It liked to kill me. As you look at the slides realize when I moved in in 1996 the house was just over 1900 square feet with a 900 square foot unfinished basement. It had two bedrooms 1 and half baths. While building it the city inspectors knew by the way it was being constructed I intended to add on.
Fourth From 1996 until 2006 when I sold the house I worked on improvements and additions until I finished the vision I had for this house. When finished it was a little over 3800 square feet with a 900 square foot finished basement. It had 4 bedrooms 3 and half baths with a built in steam shower and a huge bonus room with giant walk in closet.
Fifth I won’t get into the numbers and I don’t consider my time cost working on this house but I made a very nice profit on it. While you look at the slide show I want you to know: I laid all of the hardwood floors in this house, My wife and I did all the wood work and built all the porches on this house. I personally finished 2 baths including the steam shower work all myself. I framed, wired, insulated, hung sheet rock, finished sheet rock, did all custom trim work, painted, and hung all the fixtures in every other addition in this house. I did all the work except where I had someone install carpet.
Sixth in 2007 I bought with proceeds from the sale of the house above an old 23 Acre Apple Orchard on the side of a mountain with some very nice Piedmont views. The Land was ideal for a vineyard, ideal for starting a hard apple cider business and has many profit opportunities, I like to keep close to my vest although, your welcome some other time to look at the Business plan for this property.
Seven from 2007 until 2012 I spent my days on the development of this farm, putting life back into the Apples for future hard apple cider making, prepping the land and resources for a future vineyard and eventually wine production. Construction of a main residence designed to support numerous business potentials. Like a basement that would support being a small winery for start up and could and would later become a quest rental and even eventually our main living quarters. Below is a slide show on that property again keep in mind I ran the farming operation and I taught two farm hands everything they needed to know to help me with all the home construction you see done in these photos.
Eight in june of 2006 at the young age of 46 my wife and I became first time parents. While I’m usually behind the camera taking pictures here a few of me at work.
Nine in 1996 in addition to the house at 454 Hunter Lane, I also took an equity stake in a duplex, 8910 Sharonbrook drive. I took out a small private 10 year loan on this property for a 1/3 stake. I did this to help my mother have control over the property, as she bought the other side 8908 Sharonbrook drive for her personal residence.
Ten the five years I worked putting the Apple Orchard back in business and prepping the land for planting of a vineyard and construction on the house all got stopped when my personal funding ran out. Dodd Frank made it illegal for me to have a mortgage on that property without also having a full time job. I thought I had a full time job to farm the orchard, plant the vineyard, finish the house construction, and get the business operational. However, Dodd Frank prevents an individual such as myself from using mortgage proceeds to pay myself to work while I make capital improvements to the assets I’m borrowing against. For numerous financial reasons and advantages this is pure financial ignorance on the part of Government. Or is it actually a Deep State effort to control land use? Think about it ; its like saying if you put money in this bank you can’t draw it out unless you have a job to make payments. Actually its worse cause the value of money in the bank is pure perception it could become worthless overnight as opposed to land, diamonds, gold or oil.
Think about it for a minute why do we have front yard mechanics? If you could frame your own house, plumb it, wire it, sheet rock it, trim it, paint it, why would you want to pay anyone other than yourself to do that work, especially if you needed the work? If you could plant a vineyard yourself why would you take a job so you could pay someone else twice what you’d pay yourself? If in the end the asset is worth the same no matter who actually makes the capital improvements then you’re building sweat equity to do the job yourself. Dodd Frank wars against sweat equity! Thanks Dodd Frank!
Now lets look at that duplex and how Dodd Frank is killing opportunity for my family and friends and waring against my creation of sweat equity.
My mother passed away and now my brother and I are forced to sell the Duplex because I’m unable to find a good job. You can be sure my court battles against Wall Street, and the U.S Government are playing a major role in keeping me from gainful employment.
The Duplex is currently under contract for $237,000.00 and while I live in one side the other is rented to tenants who’ve lived there since 1996. When the contract closes we may all have to move disrupting all our lives which none of us want.
Since I have a significant equity stake in this property I could literally buy the duplex from my brother and mothers estate for $175,000.00. I could, using equity pay myself $50,000.00 over the next year to rehab the duplex and with rent afford the loan payments. New siding, new heat and air, interior and exterior painting etc. Now at the end of another year you think I could get another contract on the duplex? One at least as much as the one it’s currently under, or maybe with these improvements even more? Wouldn’t that be a better outcome for the people who’s lives are about to be disrupted and uprooted? Remember the renters have lived here over 20 years, don’t want to move, or were they’ll go. Thanks Dodd Frank!
In another year My wife or I might find good jobs, We might be able to sell the farm, we might win the lawsuit against Wall Street, although given Federal Court corruption thats not likely. We might move out and rent both sides to cover the mortgage payments. Can you be certain tomorrow you’ll have a job and be able to afford your mortgage payments. How long would your equity support you?
I’ve tried every way I know to secure financing to do just that, but Dodd Frank regulations prevent it. Hard Money lenders can’t help either because, Dodd Frank rules prevent investor properties from being owner occupied. Thats dumb too. If you’re a contractor its much easier to work on a place you’re living in. And an owner, tenet with equity at stake has a vested interest in improving the assets value as much as possible.
Below is a slide show of the Duplex. I leave you with the statement and the facts I’m happy to debate at anytime! Dodd Franks rules are stupid, inappropriate, a hinderance to capital appreciation, small business development, and personal wealth creation,
Dodd Frank Sucks!
Please any constructive comments are welcome leave some.