Amid the controversy surrounding the recent two-month payroll tax cut extension, a dirty little secret was conveniently shoved under the rug by some Washington politicians: how to pay for this cut, which cost our U.S. Treasury $33 billion.
Widely unreported in the mainstream media and unnoticed by our fellow citizens is that this $33 billion price tag is being financed by Fannie Mae, Freddie
Mac and the Federal Housing Administration increasing home loan guarantee fees charged to mortgage
lenders by one-tenth of one percentage point (see
Page 3A of the Dec. 24 Augusta Chronicle, “Payroll tax
cut saved”). This is the same mismanaged Fannie Mae and Freddie Mac that bestow huge bonuses on their executives. Of course, this fact is widely unreported as well.
Naturally the lenders pass on these fees to homebuyers and borrowers. The fees, as of Jan. 1, now apply to many new purchases and refinances. For a typical $200,000 mortgage loan, the fee increases a borrower’s cost approximately $17 a month. Many of these homeowners already are struggling to pay their mortgages while their home values are “underwater,” and have had to cope with a litany of new federal regulations in qualifying to refinance their existing home loans.
This legislation is only the latest impediment devised by our federal government to deter a lasting and complete economic recovery.
Instead of the media dwelling to an excess on the aimless and rudderless “Occupy Wall Street” movement, more attention should have been devoted by our national media onto the corrupt and seamy culture that permeates the Washington establishment. We all should be appalled and outraged that our homebuying industry, which has led us out of many recessions, is being dealt another blow by the self-imposed do-gooders and czars in the Obama administration and their arrogant cohorts from both parties in Congress.
I strongly encourage all those in the homebuying industry to contact their representatives in Congress to loudly and clearly voice their disapproval. I would also urge all my fellow citizens to remember who supported this unwise piece of legislation when they cast their ballots for Congress and president in 2012.
Nathan M. Jolles