Liberal Forum

Cannonpointer » 11 Oct 2025, 11:14 pm » wrote: ↑

11 Oct 2025, 11:14 pm

No it isn't. It's characterized as complex to confuse the simple minded. 
 

@ROG62  

I will not beg to differ with you; rather, I will express my differing opinion.
The Second Home Rider has consistently been a source of confusion, indeed on April 3, 2019 Fannie Mae revised the guidelines, (though the rules themselves remain unchanged) to assist individuals in comprehending the process of converting their second home into a rental property.
Frankly, the terminology is still intricate (as is typical of government documents), but it is significantly improved and much clearer than earlier iterations.
Irrespective of the language used, the essential point is this: you are permitted to rent out your second home, even if it is financed with a Fannie Mae loan.

The Second Home Rider does not forbid the rental of the property. The restriction within the Second Home Rider pertains to relinquishing control over rental decisions to a third party, such as a rental agent, rather than prohibiting rentals altogether.
If the Rider intended to ban rentals, it could have explicitly stated: "The Borrower shall not rent out the property."
However, it did not do so. By imposing a limitation on the engagement of third-party rental agents, the Rider implicitly permits rentals.

If the Rider does indeed prohibit rentals for more than half of the first year, then the date and duration of the lease in the James case would be pertinent, although this information is not disclosed in the indictment.
Nonetheless, I am uncertain if this truly matters, as James should prevail simply due to the ambiguity present in the Rider. The Second Home Rider represents a notably poor example of legal drafting (as do many Fannie/Freddie uniform documents). This ambiguity suggests that James should be able to counter the assertion that she “knowingly” participated in fraud.

Both allegations against James, 18 USC 1014 and 18 USC 1344, necessitate that her actions were performed “knowingly,” and the Supreme Court has recently determined, in relation to another statute, that “knowingly” pertains to the defendant’s subjective understanding. The in pari materia principle indicates that the interpretation of “knowingly” should extend to the statutes under which James was charged. It will be exceedingly challenging for the prosecution to demonstrate that James subjectively believed she was prohibited from renting out the property at the time she executed the mortgage, given the vagueness of the contractual language.

The indictment seeks to establish James’s subjective intent by highlighting that she later classified the property as a rental on her tax returns; however, this does not serve as evidence of her intent at the time of signing the mortgage. Rather, it merely reflects the fact that the property was utilized as a rental (which is permissible in any event). Furthermore, it actually strengthens James’s position as it is clear that the property was being used as a rental, which is allowed.

The Second Home Rider also has an exception for “extenuating circumstances exist that are beyond Borrower’s control.” The mortgage was from August 2020, in the middle of the COVID pandemic. That opens the door to an extenuating circumstances argument.

Still, let me humor the argument that Linsey Halligan is a true believer in fiat justitia ruat caelum. Is there any plausible legal interpretation that supports the indictment?    No

Putting this all together, this is an indictment that probably should not have been brought under the DOJ’s own guidelines: there isn’t sufficient evidence to even reach a conclusion of probable cause, much less that the evidence would be sufficient to obtain a guilty verdict.