FHA Mortgage Refinance | The Congress Debate Over G-Fees
(G-Fees) of the loan industry charged to sellers and servicers by Fannie Mae and Freddie Mac. This does also includes the Federal Housing Administration (FHA). With all 3 major lending sources potentially required to raise their loan fees, active home buyers and owners are wanting to know when this is to going to go in effect? If passed, the new mandatory g-fees will begin as soon as the New Year begins.
More On The Bill In Debate
On Tuesday, December 20th, House Republications turned down the Payroll Tax Measure by a strong kill against the Senate’s recent 89-10 passing vote just days before. The current agreement in place is due to expire at the end the month, December 2011.
Beginning January 1st, 2012, the new and mandatory loan fees will increase the cost of home purchasing and refinancing for all.
Within the bill’s current form, section titled “Mortgage Fees and Premiums”, provides instructions to the lending power houses: Fannie Mae, Freddie Mac, and the Federal Housing Association, to take specific actions. These specific details are listed as:
• Fannie Mae and Freddie Mac are to increase loan guarantee fees by 10 basis points or more versus current levels, and do not decrease other costs to compensate
• FHA is to increase mortgage insurance premiums by 10 basis points
The overall increase of extra g-fees are estimated to be an additional $10 increase per month for every $100,000 borrowed on the loan. If for example your purchase price is at the highest level for an FHA home mortgage available, a purchase price of $729,750 would estimate out as much as an additional $73 more per month for the life of the loan.
The amount collected from the g-fees is to be sent in to the U.S. Treasury and not kept by the lender.
Active FHA Mortgage Refinance Applicants
What does this mean for current homeowners looking to receive a FHA mortgage refinance? It means possible increases in loan fees and is best advised to apply for a low rate mortgage refinance sooner rather than later. To ensure you receive the lowest mortgage rates for refinancing possible, as well as low processing loan fees over the soon to come g-fees, speak to your lender today and begin the process. Though our congress members are at a stand still over this issue, an agreement must be delivered.
For refinancing in the Orange County, Los Angeles, and Ventura county areas, beat the process increase and receive a locked in low rate mortgage refinance. Right now, low fixed interests are still available. Enjoy the holidays and take the needed steps to save you and your family money this season. Before each homeowner realizes, the first of the year will be here and with details still up the in the air, increased loan fees are just a matter of time. Right now the only question still on the table is, how much?
