New homeowners’ fees to increase

Let’s start with the good news first.  If you are in a home, paying a regular mortgage, nothing’s changed, you don’t have to worry.  No added fees for you.  

However, those that are purchasing a new home at the beginning of this year or planning to refinance, you’ll be paying an additional fee in your mortgage to help fund the payroll tax cut bill that the Senate passed over the weekend.

A quick review.  Originally planning to expire on January 1 (Sunday), a payroll tax cut and long-term unemployment benefits were extended two months when the Senate voted this weekend.  It should go through the House this week.  With this extension comes a $33 billion price tag.  So who pays for it?  Yep, you guessed it.  New homeowners and those refinancing.  That fee rises about a tenth of 1 percentage point and, therefore, increases the fee that Freddie Mac and Fannie Mae charge to insure home mortgages.  It will also increase if your loan is backed by the Federal Housing Administration.

So on a $200,000 mortgage, your rate will increase approximately $17 a month.  Nothing huge but still considerable in the scheme of things.  Obviously, for a higher mortgage it goes up and a lower mortgage will have a smaller fee.  About 9 in 10 mortgages are backed by Freddie Mac, Fannie Mae, or the Federal Housing Administration.

So my question is, is this fair?  Is it the homeowners’ responsibility to pay for this?  Looking at the large picture, I’m sure many people are thrilled that these benefits have been extended, given the state of the current economy.  And if it’s not covered this way, I would think Congress would tax us higher on something else, such as gasoline, income tax, or property tax.  They’ll get their money some way.  I’m curious to hear if you think this is right or if you have a better solution.  Please leave me a comment!  You can also reach me via my Web site.

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