We should all be glad that mortgage CLOSING COSTS are up front and center, and fight like hell to keep it that way. This is a huge benefit to borrowers, EVEN IF THEY DON'T REALIZE IT. No cost loans are nothing more than HIDDEN COST LOANS.

Everything that we buy has closing costs, but only in the home loan business ARE THOSE COSTS BROKEN DOWN, ITEMIZED, AND DISCLOSED TO THE BUYER. In almost everything else we finance or purchase, those "closing costs" are simply hidden away and added to the cost of whatever it is you buy.

Take for example, buying a car. Here in California, you may negotiate for hours over the price of the car, but you'll never know how much you paid to arrange the financing, register the car with DMV, appraise and take in the trade, and do all of the title work and insurance verification BECAUSE "FEES" ARE NOT ALLOWED ON VEHICLE TRANSACTIONS. And the irony is most of us in California would pay just about anything NOT to go to the Department of Motor Vehicles..(DMV)

YOUR ENTIRE CLOSING COST FEES ARE $45, and will appear on you paperwork as "DOC FEE". What a bargain, right? Wrong.

Who paid for all of the other costs to handle this complicated transaction? YOU DID, HIDDEN IN THE PRICE OF THE CAR AND THE PRICE OF THE FINANCING!

So lets' say houses were sold like cars. That's right, let's charge a $45 doc fee, and eliminate all other closing costs. Heck, we're just as good as those crazy guys at the car dealership, and we want to make our mortgage clients just as happy!

For starters, we're going to take your old house in trade, but at less than it's really worth (so we can cover the costs of refurbishing it,  of insuring it, re-titling it, and marketing it).

We're going to price every house high enough to cover paying our loan officer, your appraisal, your title insurance, your recording fees, and your escrow officer.

If you don't like the price of the house, you can get it for less, but we're going to charge you a higher interest rate on your loan to compensate. If you don't want our financing, we're going to charge you more for the house. And all of our processing fees will need to be wrapped in as well, NEATLY HIDDEN FROM YOU.

And oh, yes, if you strike a good deal on BOTH the financing, AND the car, we're going to trap you at the closing table until you buy SOMETHING ELSE. You know, our "rust and dust" package that will protect the paint on your home from sun damage for only $1600. You see, we have to cover the costs of paying to process your loan, and we're going to get you one way or another.

I say, hidden costs, while easier to swallow, WILL ALMOST CERTAINLY BE HIGHER. No cost loans set a dangerous precedent.