New Housing "COVID TAX" Freddie Mac Refinance Real Estate Fee 4K

Freddie Mac and Fannie Mae, decided to stick it hard to homeowners today and implement a new mandatory fee, basically a tax on everyone—all this and more in today’s video.

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Wow. I am speechless. In a time of economic turmoil from the current pandemic, the fat cat bankers at Freddie and Fannie decided now was the perfect time to increase mandatory fees.

As most of you guys know, or at least if you have been listening to my channel, you should most definitely know. Mortgage rates are at historically low rates right now, and almost every homeowner would benefit by refinancing their higher interest rate into a new lower 30-year rate now.

The problem with the low rates, well at least from the banking and lending industry’s perspective is they make far less money over the life of the loan.

I can almost picture these guys sitting on their expensive yacht off some beautiful Caribbean Island complaining that they are not making enough money during this pandemic. Until one guy interrupts and says, “How about we increase our fees and make the working-stiff pay for it.” The boat erupts in laughter as they return to their life of decadence while the people suffer.

Backing up just for a second. Freddie and Fannie are semi-government backed corporations that guarantee a vast majority of traditional home mortgages in the US. While they are not lenders themselves, they purchase many loans from your bank. There are many good and also bad things about Freddie and Fannie, but for this conversation, let’s keep it short and sum it up this way. You buy a house; you get a loan from your local bank, then the bank sells that loan to Freddie or Fannie.

One of these new terms targets the smart homeowner that wanted to take advantage of these new low-interest rates; they just got screwed us all with an additional 0.5% fee of the loan amount. That amounts to $1,400 on the average mortgage originated today. It will begin in September, which means it will basically apply to all refinances that aren’t already in process.

Now with these new fees, is it still worth it to refinance? For me, on my primary home, I just completed my refinance this week and saved 1% off my mortgage. So for me, yes, it was. Of course, I closed mine before this new fee, and additionally, I have a VA loan that is NOT affected by this new fee.

Ok, ok, but keep in mind. First off, the 1% savings is over the life of the loan, so that is 1% you save every single year, compounded over the 30 years. For a $200,000 loan, a 1% difference means you will pay an additional $35,935 over 30 years. If you borrow $400,000, you will pay an additional $71,870 in interest over 30 years.

Whereas the half-percent they charge today is a one-time fee, yes it sucks, and pisses me off they are doing it, but in most cases, the average homeowner will still save in the long run even paying this additional fee upfront.

The Trump administration criticized this new fee, saying it would harm consumers. “The White House has serious concerns with this action, and is reviewing it,” a senior White House official said in a written statement late Thursday. “It appears only to help Fannie and Freddie and not the American consumer.”

⚠️ ⚠️ ⚖️⚖️ I am not a lawyer, CPA, tax advisor, realtor, financial advisor, etc., I have absolutely no licenses/certifications in anything related to these industries, I am just a dude on the internet. So, in full disclosure: the information I provide here is for “entertainment purposes only!” You should seek counsel from competent and certified individuals if you have questions. I may receive commissions when you use my affiliate links. real estate market update real estate fee real estate entrepreneur covid real estate market report refinance fee

Видео New Housing "COVID TAX" Freddie Mac Refinance Real Estate Fee 4K канала The Steven Carlson Show