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Mortgage Loans set to increase due to Payroll Tax cut, HR 3630

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Mortgage and Lending with Mortgage Miracles Happen, NMLS ID: 1289680 NMLS # 285653

Who's ready for a tax increase?  Like it or not

The standoff in Washington for the payroll tax cut is going to be funded by no other than the homeowners of all people that have any type of mortgage after Dave Camp's (R-CA-3) Bill HR3630 entitled "Temporary Payroll Tax Cut Continuation Act of 2011" was passed.  It includeds a provision that virtually very few people are aware of, a mortgage backed security guarantee fee.  In other words, the cost of this is an increase of 10 basis points to the interest rate.  Was this transparent to the American people.  Not at all.  Who is going to be shouldering this increase?  A small percentage of the public is paying for everyone elses tax incentives by having their mortgage payments increased over time.  Is this fair?  Well, this is government at its best.

The FHA annual (monthly) insurance premium is increasing an additional 10 basis points.

The bottom line is the cost of housing is going up to help fund the payroll tax cut.

So instead of everyone shouldering the burdon, all individuals and families will be the ones to shoulder this burdon for the life of their loan.

Take a look at the 3 page excerpt of the Guarantee Fee portion of the bill by clicking here.

Ben Gerritsen is a loan officer based in Utah.

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