CASCADE FUNDING, INC.

Cascade Funding Inc is a BBB Accredited Financial Service in Kirkland, WA

News                       

Home News Products Feedback

Web Changes

This is where we'll announce recent additions to our web site and news worthy events affecting our industry and how they affect recipients of future payments. If you've visited us before and want to know what's changed, take a look here first.

5/31/11: 

"The Federal Trade Commission has charged Russell Dalbey, the CEO and founder of the company behind the “wealth-building” program “Winning in the Cash Flow Business,” with defrauding consumers, in some cases out of thousands of dollars, with phony claims..." Follow this link for the full details:  http://www.ftc.gov/opa/2011/05/dalbey.shtm

04/30/2010

HR 1728

The U.S. Senate is considering a bill that would severely limit the way you do business as a creative investor and, more importantly, is an inexcusable infringement of the property rights of all Americans.

HR 1728, which you can view in its entirety here:

http://www.govtrack.us/congress/bill.xpd?bill=h111-1728

The bill deals with a plethora of mortgage-related issues, mostly around limited terms and fees on residential loans. But the heinous piece of the legislation is in section 101(3)(e), which defines the affected principals as:

(E) does not include, with respect to a residential mortgage loan, a person, estate, or trust that provides mortgage financing for the sale of 1 property in any 36-month period, provided that such loan-
(i) is fully amortizing;
(ii) is with respect to a sale for which the seller determines in good faith and documents that the buyer has a reasonable ability to repay the loan;
(iii) has a fixed rate or an adjustable rate that is adjustable after 5 or more years, subject to reasonable annual and lifetime limitations on interest rate increases; and
(iv) meets any other criteria the Federal banking agencies may prescribe; and

Here’s what it says: you are NOT subject to the law as long as you DON’T sell more than 1 property with owner financing every 3 years! Or, to put it another way, you ARE subject to the limitations of the law if you DO sell more than one property every 3 years via a land contract, owner-held mortgage or wrap-around mortgage.  And who knows if they’ll define lease/options as owner financing, too?

So what does it mean to be “subject to the law”? Well, at the very least, it means that you will have to comply with a long, confusing, and penalty-filled piece of national legislation. Here are the types of transactions that you would be restricted from doing more than once every 36 months:

* Selling YOUR OWN HOME using a land contract or owner-held mortgage so that you can get a quicker sale, higher sale price, or better rate of interest than is available in other investments

* Carrying back owner-held second mortgages on investment properties that you sell

* Doing any kind of installment sale on residential properties including homes, condos, mobile homes, and even raw land that is zoned residential

Yes, there will undoubtedly by ways to get around it.  Some have suggested that getting a mortgage broker’s license would circumvent the “problem”. But the bottom line is, this law has to be stopped and it has to be stopped NOW. Here’s why:

1. Congress is trying to regulate the wrong thing. The deals we make are not “loans.” They don’t involve the transfer of money, or points or closing costs or adjustable rates or any of the other things that caused the mortgage crisis to begin with. They are INSTALLMENT SALES. We don’t give money to the “borrower” and wait for it to be paid back: we give a property to the borrower and wait for it to be paid off. Regulating this will have no effect on the foreclosure crisis

2. It is a completely unacceptable infringement on private property rights. When I own a piece of property and find a ready, willing, and able purchaser, I should be able to control the sale of that property within the existing laws of my state, which already regulate the interest rate that I am able to charge and some of the terms of the sale. The government does not have the right to tell us that we need special licensing to sell our own properties; nor do they have the right to further regulate the terms under which we can sell or burden small investors with a new set of rules that we can’t comply with.

Not only will this new law, if passed as written, effectively eliminate owner financing as an exit strategy for you, it will also take away housing choice for your buyers. The millions of Americans who’ve been through foreclosure in the last 3 years can’t buy a house in any way OTHER THAN to negotiate owner financing with a seller and HR 1728 would eliminate that. Millions of potential home owners who would otherwise be able to re-start the process of buying a home, and get the tax advantages of ownership, will be reduced to renting until they are able to qualify for bank financing.

What to Do Right Now

This bill has already passed the house and is waiting for Senate approval. Please contact your senator via email and snail mail to let him know that this law MUST NOT PASS in its current form. You can get your senator’s contact information here:

http://www.senate.gov/general/contact_information/senators_cfm.cfm

As always in cases like this, you have an automatic handicap to overcome-the fact that you are a real estate investor and are therefore viewed as part of the problem. So when you write, don’t emphasize the nature of your business, just that your buyers would be adversely affected by the new law.

We need THOUSANDS of these communications to go out in the next few days to have a CHANCE of stopping this in its tracks. So whether you’re a new or experienced investor, PLEASE take the time right now to write your elected representative!

Here are some sample letters or emails.

IF YOU HAVE A REAL ESTATE LICENSE
Dear Senator [name];

My name is (insert name here) and I am a resident of (insert city name here).

I am writing you to encourage you to vote NO on HR 1728, the “Mortgage Reform and Anti-Predatory Lending Act”.

While many of the provisions of the act are positive steps toward mortgage reform, the inclusion of private owners in the act (see section 101(3)(e)) will enormously reduce the housing choice of citizens and the ability of home owners to sell properties in this already-slow market.

As a real estate broker, I have seen several dozen cases in the  past year of home sellers and buyers coming to an agreement for an installment sale on a property that the owner desperately needed to sell (often to avoid foreclosure) and the buyer desperately wanted to buy, but could not raise the down payment needed for conventional financing.

In all cases, these sales turned out to be win-win deals for the buyer and seller; the seller was able to get rid of an unwanted property to a buyer who loved it, and the buyer was able to get his new home at an affordable payment and interest rates with none of the usual costs (points, application fees etc) inherent in more conventional mortgage transactions.

In defense of private property rights, owners should be exempted from the burdensome and unnecessary rules that this law foists upon them. In its current form, it would all but shut off the “owner financing” market that is the only way that many sellers can sell and many buyers can buy right now.

PLEASE DO NOT LET THIS RESTRICTION ON PRIVATE PROPERTY RIGHTS PASS THE SENATE. It is unnecessary to stop private buyers and sellers from transacting business that is beneficial to both of them-they are not the problem that the bill seeks to solve. HR 1728 would be extremely harmful to thousands of your constituents.

It will exacerbate the problem OF foreclosure, as fewer sellers will be able to sell their homes to avoid it, and CAUSED BY foreclosure, as fewer buyers who have recently experienced foreclosure will be able to re-start the process of home ownership inexpensively and easily by negotiating owner financing.

Thank you for your consideration,

Insert Name
Licensed Real Estate Broker license #
Phone #
email

IF YOU SELL HOUSES WITH OWNER FINANCING
Dear Senator [name];

My name is (insert name here) and I am a resident of (insert city name here).

I am writing you to encourage you to vote NO on HR 1728, the “Mortgage Reform and Anti-Predatory Lending Act”.

While many of the provisions of the act are positive steps toward mortgage reform, the inclusion of private owners in the act (see section 101(3)(e)) will enormously reduce the housing choice of citizens and the ability of home owners to sell properties in this already-slow market.

As a housing provider, I sell several houses each year to home buyers on installment sale [or, if you have not purchased a property, add here: "I had planned to sell several houses this year on installment sale]-a practice that would become impossible under this law in its current form.

I find that in today’s slow market, the best way for me to help buyers who desperately want to become homeowners, but who cannot raise the down payment or meet the other terms needed for conventional financing, is to allow them to make payments directly to me.

These sales are win-win deals for both the buyer and myself; I am able to turn over homes that I’ve bought and rehabbed (often from foreclosures) to buyers who love and can afford them, and the buyer can get his new home at an affordable payment and interest rates with none of the usual costs (points, application fees etc) inherent in more conventional mortgage transactions.

Without the ability to sell homes in this way, I will no longer be able to invest in and renovate any of the tens of thousands of vacant, ugly houses placed on the market by the foreclosure crisis, and my small but beneficial business will literally be in ruins. Perhaps more importantly, the homeowner/buyers that I serve will be forced to rent rather than moving toward the American dream of home ownership.

In defense of private property rights, owners should be exempted from the burdensome and unnecessary rules that this law foists upon them. In its current form, it would all but shut off the “owner financing” market that is the only way that many sellers can sell and many buyers can buy right now.

PLEASE DO NOT LET THIS RESTRICTION ON PRIVATE PROPERTY RIGHTS PASS THE SENATE. It is unnecessary to stop private buyers and sellers from transacting business that is beneficial to both of them-they are not the problem that the bill seeks to solve. HR 1728 would be extremely harmful to thousands of your constituents.

It will exacerbate the problem of foreclosure, as fewer sellers will be able to sell their homes to avoid it.

Thank you for your consideration,

Insert Name
Phone number
email

IF YOU BUY HOUSES WITH OWNER FINANCING

Dear Senator [name];

My name is (insert name here) and I am a resident of (insert city name here).

I am writing you to encourage you to vote NO on HR 1728, the “Mortgage Reform and Anti-Predatory Lending Act”.

While many of the provisions of the act are positive steps toward mortgage reform, the inclusion of private owners in the act (see section 101(3)(e)) will enormously reduce the housing choice of citizens and the ability of home owners to sell properties in this already slow market.

In the past year, I have purchased and renovated several homes-made possible only because the sellers of these homes were able to sell to me using owner financing in an unrestricted way.

For many of these property owners, seller financing was the only way to unburden themselves of an unwanted property that, in some cases, was headed toward foreclosure before I purchased it.

Without this ability, I can not continue to buy and renovate properties in the neighborhoods that so need me and my colleagues to invest our time, energy, and money in rehabbing properties.  Bank financing is not an option for these properties because of the condition; only financing carried by the sellers will suffice.

Section 101(3)(e) would keep my sellers from utilizing this method of getting rid of unwanted properties in today’s market, should they have more than 1 to sell.

In defense of private property rights, owners should be exempted from the burdensome and unnecessary rules that this law foists upon them. In its current form, it would all but shut off the “owner financing” market that is the only way that many sellers can sell and many buyers can buy right now.

PLEASE DO NOT LET THIS RESTRICTION ON PRIVATE PROPERTY RIGHTS PASS THE SENATE. It is unnecessary to stop private buyers and sellers from transacting business that is beneficial to both of them-they are not the problem that the bill seeks to solve. HR 1728 would be extremely harmful to thousands of your constituents.

It will exacerbate the problem of foreclosure, as fewer sellers will be able to sell their homes to avoid it.

Thank you for your consideration,

Insert Name
Phone number
email

 

 

12/01/2009

We haven't been updating this page regarding the economy since there is just too much to report on since the crash and since economic news is now headline news.

12/17/08

The Fed on Tuesday announced that it was reducing its target for the federal funds rate to between zero and 0.25 percent, down from 1 percent, a level that was already the lowest target rate in a half century.

10/30/08

The stock market got the news today that it expected from the Federal Reserve — a half-point cut in interest rates — and then waffled in late afternoon trading, unable to settle on a direction. The major indexes shifted between gains and losses after the central bank announced it was lowering its target for the fed funds rate to 1 percent.

03/18/08

The Federal Reserve on Tuesday slashed a key interest rate by three-fourths of a percentage point, moving aggressively to contain a credit crisis threatening to push the country into a severe recession.   The latest action brought the federal funds rate _ the interest that banks charge each other _ down to 2.25 percent, the lowest point since late 2004. It marked the second cut of three-fourths of a percentage point this year. The first occurred at an emergency meeting on Jan. 22 and was followed by a half-point cut at a regular meeting on Jan. 30.  Fed Chairman Ben Bernanke and his colleagues have now cut the funds rate six times since last September, with the reductions becoming more aggressive since January as the central bank has faced growing turmoil in global financial markets.  In explaining its actions, the Fed said that it was having to navigate a difficult policy environment that included sluggish economic activity and rising inflation pressures.  The Fed statement said that "the outlook for economic activity has weakened further" but that "inflation has been elevated" with some signs that expectations of future inflation pressures are rising, a dangerous sign for the Fed.  But the Fed signaled that it stood ready to cut rates further if necessary, saying that "downside risks to growth remain." Bernanke and other Fed officials have said in recent comments that they view the threat of economic weakness as a bigger risk at the moment than inflation given the risks to financial markets.  "Financial markets remain under considerable stress and the tightening of credit conditions and the deepening of the housing contraction are likely to weigh on economic growth over the next few quarters," the Fed said in its statement.

01/30/08

The Federal Reserve on Wednesday cut a key interest rate for the second time in just over a week, reducing the federal funds rate by a half point. It signaled that further rate cuts were possible.  The Fed action pushed the funds rate to 3 percent. It followed a three-fourths of a percentage point cut on Jan. 22, a day after financial markets around the world had plummeted on fears that the U.S. economy was heading into a recession. That decrease had been the biggest one-day move in more than two decades.  The half-point cut Wednesday followed news that the economy had slowed significantly in the final three months of last year with the gross domestic product expanding at a barely discernible pace of 0.6 percent, less than half what had been expected. The report came amid increased concern from several quarters about a possible recession.

01/22/08

The Federal Reserve, confronted with a global stock sell-off fanned by increased fears of a recession, slashed a key interest rate by three-quarters of a percentage point on Tuesday and indicated further rate cuts were likely. The surprise reduction in the federal funds rate from 4.25 down to 3.5 percent marked the biggest one-day rate move by the central bank since it cut its discount rate by a full percentage point in December 1991, a period when the country was struggling to get out of a recession.  Analysts said the Fed will likely delay cutting rates further at its Jan. 29-30 meeting but will probably keep moving rates down aggressively as the economy continues to weaken.  "This move is not an instant fix," said Ian Shepherdson, chief U.S. economist at High Frequency Economics. "The economy is still staring recession in the face, but at least the Fed now gets it."  In addition to cutting the funds rate, the Fed said it was reducing its discount rate, the interest it charges to make direct loans to banks, by a similar three-quarters of a percentage point, pushing this rate down to 4 percent.  Commercial banks responded to the Fed's action on the funds rate by announcing similar cuts of three-quarter of a percent on its prime lending rate, the benchmark for millions of business and consumer loans. The action will mean the prime lending rate will drop from 7.25 percent down to 6.50 percent.  The Fed action was the most dramatic signal it can send that it is concerned about a potential recession in the United States.

12/12/07

The Fed's policymaking committee cut the federal funds rate, at which banks make overnight loans to each other, by a quarter percentage point, to 4.25 percent.  The third rate cut this year is likely to trickle through to interest rates on credit cards, business loans and some adjustable-rate mortgages.  But investors had hoped for a half-point cut, or at least a clearer signal that the central bank will cut rates again in the future, and stocks plummeted. The Dow Jones industrial average closed down 294 points for the day, a 2.1 percent drop.

11/01/07

The Federal Reserve lowered its benchmark interest rate by a quarter-point to 4.5 percent Wednesday, moving to spark the U.S. economy amid conflicting economic signals

9/19/07

For the first time since 2003, the Federal Reserve cut a key interest rate Tuesday, meaning borrowers should see rates drop on a variety of loans.  The Fed also left the door open to further rate cuts to prevent a painful housing slump and jarring credit crunch from driving the country into recession.  In the anxiously awaited decision, Federal Reserve Chairman Ben Bernanke and his central bank colleagues lowered the target federal funds rate — which determines what banks pay to borrow money from each other overnight — by half a percentage point to 4.75 percent.

8/17/07

Stocks soared Friday, propelling the Dow Jones industrials up more than 180 points, after the Federal Reserve, acknowledging that the stock market's plunge posed a threat to the economy, slashed its discount rate by a half percentage point.  The central bank's step, which Wall Street was angling for, gave the market a boost after weeks of losses fueled by turmoil in the credit markets. The Fed has poured billions in additional liquidity into the banking system in recent days — on Friday, it added $6 billion — but the rate cut was its most dramatic effort yet to alleviate fears about tightening credit and calm the global financial markets.  The Fed cut the discount rate to 5.75 percent from 6.25 percent, declaring that "downside risks" to the economy have increased appreciably.  However, the central bank did not change its target for the federal funds rate, which has remained at 5.25 percent for more than a year. Many strategists believes the market won't settle down until the Fed lowers the fed funds rate — the rate banks charge each other on overnight loans. The discount rate only covers loans the Fed makes to banks.  It was too early to tell how much of the buying was a relief rally after weeks of losses, and whether the gains would stick. The market has quickly given back any advances it has scored in recent weeks amid growing signs of problems in the credit markets.  For investors, the question is whether the discount rate cut is a signal that the Fed is seriously leaning toward cutting the fed funds rate, considered a more important benchmark, at its next meeting on Sept. 18.

6/29/07

The Federal Reserve held interest rates steady Thursday, extending a yearlong breather for borrowers. Although policymakers observed improvements on inflation, they made clear they were not ready to declare victory on that front.

6/1/07

JUSTICE PREVAILS!

FTC Obtains Judgment of More Than $17 Million for Consumers.  Judge Finds Misrepresentations Made to Sell Workshops, Seminars, Videos, and Other Products. 

Follow this link: http://ftc.gov/opa/2007/05/stefanchik.shtm.

This is entirely consistent with the information we provide regarding companies that sell Note Brokering, Note Buying courses to the public.  Read our information here:  http://www.cascadefunding.com/brokers.htm.

This is the conclusion of the FTC investigation and action see below (1/19/05).

5/10/07

The wait goes on for borrowers looking for some interest-rate relief.  The Federal Reserve on Wednesday held rates steady and many economists think rates could stay put for most — if not all — of this year.  Fed Chairman Ben Bernanke and his central-bank colleagues left an important interest rate unchanged at 5.25 percent, where it has stood for nearly a year.  The Fed's decision means that commercial banks' prime interest rate — for certain credit cards, home equity lines of credit and other loans — stays at 8.25 percent.

 

2/1/07

Now there is encouraging news on inflation, and the economy is revving up. So Bernanke and his central-bank colleagues Wednesday held a key interest rate steady at 5.25 percent and extended a half-year breather for U.S. borrowers.  To fend off inflation, the Fed steadily boosted interest rates for two years, the longest stretch in its history.  But since summer, it has left rates alone. Economists believe the Fed is on course to achieve its goal of slowing the economy sufficiently to thwart inflation but not so much as to seriously hurt economic activity

 

6/23/06

Mortgage rates rose this week, with 30-year mortgages climbing to the highest level in more than four years on investor fears about inflation...Freddie Mac reported Thursday that rates on 30-year, fixed-rate mortgages rose to a nationwide average of 6.71 percent, up from 6.63 percent last week. It was the highest level for 30-year mortgages since they averaged 6.76 percent the week of May 31, 2002. The Fed meets next week and financial markets now view it as a virtual certainty that the central bank will boost rates for a 17th consecutive time. "Financial markets believe that the current rate of inflation is above the Fed's comfort zone, which will lead to more rate hikes in the near future," said Frank Nothaft, Freddie Mac's chief economist.  Nothaft said there is growing concern among markets that the Fed also will raise rates at its August meeting.

Editor's Note:  As interest rates increase the value of future payments from Notes decrease.  This means less cash for people selling notes.  If you believe interest rates will continue to rise, and you are considering selling your note, the best advice would be to do it sooner rather than later. (As of this writing, Cascade Funding, Inc. is still purchasing notes based on 2001 interest rates -- but this definitely will not last much longer, especially if the current trends continue.)

3/29/06

The Federal Reserve on Tuesday (3/28/06) boosted a key interest rate to the highest level in five years as new Chairman Ben Bernanke followed the Alan Greenspan inflation-fighting formula.  The action, the 15th consecutive quarter-point move, left the federal-funds target rate at 4.75 percent, its highest level since April 2001.  The Fed's latest move will mean higher interest rates for both consumers and businesses. KeyCorp was the first bank to announce it was raising its prime lending rate by a similar quarter-point to 7.75 percent. The prime is the benchmark for millions of business and consumer loans.  Many analysts believe the Fed ... may feel the need to push the funds rate up to 5 percent. However, other analysts who are more worried about inflation pressures say the Fed may feel the need to boost rates not only at the next meeting on May 10 but also at perhaps two more meetings after that, leaving the funds rate at 5.5 percent.

11/02/05

Fed officials unanimously agreed to lift their benchmark federal-funds rate to 4 percent from 3.75 percent, for a 12th consecutive increase since June 2004, when the rate was at a 40-year low of 1 percent.  Fed Chairman Alan Greenspan and his colleagues on the committee indicated they view the rate as low enough to stimulate economic activity and said they would probably keep lifting it at a "measured" pace, which has come to mean a quarter-percentage-point increase at each scheduled committee meeting.

1/19/05

FTC Obtains Preliminary Injunction Against Sellers of Real Estate Investment Training Program

A U.S. District Court Judge has found that the Federal Trade Commission has “demonstrated a likelihood of success on the merits” against two of the defendants named in the FTC’s action against two companies and two individuals selling an investment business opportunity. The FTC alleged in its complaint that defendants John Stefanchik and the Beringer Corporation deceptively marketed and sold a business opportunity for buying and selling privately-held mortgage notes, commonly referred to as mortgage “paper,” ...

Follow this link to read the rest of the Press Release: http://www.ftc.gov/opa/2005/01/stefanchik.htm

12/14/04

The Federal Reserve raised interest rates Tuesday (12/14/04) for a fifth time this year and signaled that it intends to continue pushing up borrowing costs for businesses and consumers at a "measured" pace.  The Fed has raised short-term lending levels by 1.25 percentage points since beginning its tightening cycle in late June (2004) when the federal funds rate was at a 46-year low of 1 percent. The Fed's decisions influence a range of other short-term rates including the prime rate, for top business and individual customers, which was expected to rise to 5.25 percent after the latest move.  Market expectations are that the central bank will raise rates another quarter-point Feb. 2, 2005, when it concludes its first meeting of 2005.

10/8/04

The Federal Reserve Bank has begun to raise interest rates, two times so far this year.  Note investor buy rates have not yet been affected in most cases; however, the trend is clear.  If rates continue to rise, it will only be a matter of time before yields on long term investments will rise.  Usually these increases happen quickly and dramatically in anticipation of future fed hikes.  If you are a holder of a real estate Note and are considering selling it, chances are that selling it now will provide the greatest cash.

9/28/04

The FTC has begun a lawsuit against one of the seminar gurus selling Note Brokering courses.  See the complaint and news release here:  http://www.ftc.gov/os/caselist/0223246/0223246.htm.  (Note:  This link will be time-sensitive.  If it doesn't work, it is because the FTC has removed the page due to a change in the status of the case.  See above news items for updates to this case.)

 6/25/03

Check out the Note Brokers page for a new warning just issued.  This information may prove useful to anyone considering a note brokering course, program, or online note exchange.

12/12/01

The Federal Reserve Bank has lowered interest rates 11 times this year.  This has led to a decrease in the yields required by investors when purchasing future payments.  This results in greater cash offers to note sellers.  In fact, because interest rates are at their lowest levels in 40 years, the price we are paying for future payments on notes has never been greater in the history of our industry.  Therefore, if you are considering selling all or part of your real estate note, now is the time to do it.  Don't wait until interest rates begin to rise again.

Return To Home Page


Call Us Toll Free: 1-800-476-9644

Send mail to email@cascadefunding.com with questions or comments about this web site.
Copyright © 1997
Last modified: May 21, 2012