Obama Administration's Hidden Fee On Home Loans A Secret Tax Increase

President Obama has trumpeted the temporary payroll tax cut as his major victory for middle class Americans. Unfortunately, he isn't telling you about the massive screwing over homeowners are getting to pay for a few hundred dollars in savings.

Hidden in the bill that the president signed that came down from the Senate is a provision that adds a minimum monthly fee of one tenth of one percent per month for every $200,000 of the loan amount on every purchase or refinance - for the life of the loan.

For those of you whom are math challenged, for a $300,000 purchase or refinance loan, that amounts to $37.50 added on to your monthly payments...every year you have your loan:

The new fee is a minimum of one-tenth of 1 percent on Fannie Mae- and Freddie Mac-backed loans, and is likely to go much higher.

It will be imposed for the next 10 years on most mortgages and refinancings and it lasts for the life of the loan.

For every $200,000, it amounts to an extra $15 dollars a month.

It's bad news for Patty Anderson, who's buying a home in Virginia.

Anderson will save a couple hundred dollars from having her payroll tax cut extended but her mortgage broker told her the new fee would cost her almost $9,500.

"I was absolutely startled that it would add up to that much," she said.

The $35.7 billion collected in fees won't go into the Social Security fund to replace the lost payroll tax. It goes to the general treasury where Congress can spend it however they please.

Bill Burnett, Anderson's broker and president of the Virginia Association of Mortgage Brokers, said you won't see Congress' new charge in the paperwork, but it's there.

"It's actually built into this [interest] rate. You would never see the fee as a cost to you," he said. {...}

One congressman, Florida Republican Allen West, said he tried to blow the whistle on the whole thing before Christmas.

"I read the legislation and raised the flag. Unfortunately nobody paid attention to what I was saying at the time," he said, calling the fee a backdoor tax increase on the middle class.

"It absolutely is because you're talking about the homeowners - when you're talking about the people that are gonna be using the Fannie Mae, the Freddie Mac, the government-sponsored enterprises - it is absolutely a tax increase on them."

An Obama administration official defended the mortgage fee, calling it "modest." She said it's "unlikely to negatively affect borrowers" because increases "will be phased in over the next two years." And it will "help bring private capital back into the mortgage market, which [is] good for borrowers over the long term."

Except it isn't going into 'private capital' but right into Congress's general fund.Hey,what one more lie at this point?

$9,500 in new taxes in exchange for a couple of hundred dollars in tax relief for two months. This is what President Obama and the Democrats mean by 'new revenues'. And it's exactly what the GOP presidential candidates ought to be screaming bloody murder about.

Obama Administration's Hidden Fee On Home Loans A Secret Tax Increase

President Obama has trumpeted the temporary payroll tax cut as his major victory for middle class Americans. Unfortunately, he isn't telling you about the massive screwing over homeowners are getting to pay for a few hundred dollars in savings.

Hidden in the bill that the president signed that came down from the Senate is a provision that adds a minimum monthly fee of one tenth of one percent per month for every $200,000 of the loan amount on every purchase or refinance - for the life of the loan.

For those of you whom are math challenged, for a $300,000 purchase or refinance loan, that amounts to $37.50 added on to your monthly payments...every year you have your loan:

The new fee is a minimum of one-tenth of 1 percent on Fannie Mae- and Freddie Mac-backed loans, and is likely to go much higher.

It will be imposed for the next 10 years on most mortgages and refinancings and it lasts for the life of the loan.

For every $200,000, it amounts to an extra $15 dollars a month.

It's bad news for Patty Anderson, who's buying a home in Virginia.

Anderson will save a couple hundred dollars from having her payroll tax cut extended but her mortgage broker told her the new fee would cost her almost $9,500.

"I was absolutely startled that it would add up to that much," she said.

The $35.7 billion collected in fees won't go into the Social Security fund to replace the lost payroll tax. It goes to the general treasury where Congress can spend it however they please.

Bill Burnett, Anderson's broker and president of the Virginia Association of Mortgage Brokers, said you won't see Congress' new charge in the paperwork, but it's there.

"It's actually built into this [interest] rate. You would never see the fee as a cost to you," he said. {...}

One congressman, Florida Republican Allen West, said he tried to blow the whistle on the whole thing before Christmas.

"I read the legislation and raised the flag. Unfortunately nobody paid attention to what I was saying at the time," he said, calling the fee a backdoor tax increase on the middle class.

"It absolutely is because you're talking about the homeowners - when you're talking about the people that are gonna be using the Fannie Mae, the Freddie Mac, the government-sponsored enterprises - it is absolutely a tax increase on them."

An Obama administration official defended the mortgage fee, calling it "modest." She said it's "unlikely to negatively affect borrowers" because increases "will be phased in over the next two years." And it will "help bring private capital back into the mortgage market, which [is] good for borrowers over the long term."

Except it isn't going into 'private capital' but right into Congress's general fund.Hey,what one more lie at this point?

$9,500 in new taxes in exchange for a couple of hundred dollars in tax relief for two months. This is what President Obama and the Democrats mean by 'new revenues'. And it's exactly what the GOP presidential candidates ought to be screaming bloody murder about.

Payroll Deductions cartoon

Daily Politics cartoon here:

http://baloosdailypoliticscartoon.blogspot.com/

The Payroll Tax Issue, Simply Explained

With all the verbiage and posturing going on,(a deliberate attempt to obscure things by the democrats and their media allies, as far as I'm concerned) I think a simple and direct explanation of this issue is in order.

The legislation in question actually has three components. Needless to say, the president and the Democrats are only talking about one of them.

The first one, the one that's getting all the attention is a payroll tax holiday extension for an additional two months.

The second part is completing the Keystone Pipeline to carry 700,000 barrels of crude per day from the Canadian oil sands in Alberta to refineries in Port Arthur, Texas. This would provide an estimated 20,000 American jobs and lower prices at the pump.The president, of course, says he'll veto it, citing global warming and environmental issues.

The third part involves another Federal extension of unemployment benefits.

A number of Republicans in the Senate stupidly approved a bill that would extend the payroll tax for another two months, allow President Obama the leeway to approve the pipeline construction at his discretion, (which means it won't happen) and provides funding for another federal unemployment extension.

The GOP-dominated House refused to go along with this, as Speaker Boehner showed some courage for a change. The House wants a compromise that would extend the payroll tax holiday for an entire year,would force President Obama to veto the Pipeline bill, and allow the extension of unemployment benefits.

The President and the Democrats have so far refused to sit down and negotiate any of this. The last thing the president and his allies want, aside from lower gas prices is a long term tax cut, both of which provide less revenues for President Obama's domestic agenda.

The House Republicans made a huge PR error in not making the pipeline the sticking point rather than the payroll tax holiday. Instead, they should have compared the jobs and the savings at the pump to the estimated $40 per paycheck a family of four with a $50,000 income would save (about $160 total) as compared to the jobs and the more permanent lowering of gas prices, goods and services. To make it even simpler, they could have upped the ante and said "President Obama wants to save you about $160 for two months. We want to save you $1,040 by extending the tax holiday for a full year, plus the benefit of lower gas prices at the pump. Which would you rather have?"

That's what's going on,in a nutshell.I'm frankly amazed that the GOP leadership can't explain that for some reason.

Perhaps they ought to hire me in some capacity.

UPDATE, 2:00PM PST : I see where the House Republican leadership caved in completely. Idiots. And gutless ones at that.

please donate...it helps me write more gooder!

The Payroll Tax Issue, Simply Explained

With all the verbiage and posturing going on,(a deliberate attempt to obscure things by the democrats and their media allies, as far as I'm concerned) I think a simple and direct explanation of this issue is in order.

The legislation in question actually has three components. Needless to say, the president and the Democrats are only talking about one of them.

The first one, the one that's getting all the attention is a payroll tax holiday extension for an additional two months.

The second part is completing the Keystone Pipeline to carry 700,000 barrels of crude per day from the Canadian oil sands in Alberta to refineries in Port Arthur, Texas. This would provide an estimated 20,000 American jobs and lower prices at the pump.The president, of course, says he'll veto it, citing global warming and environmental issues.

The third part involves another Federal extension of unemployment benefits.

A number of Republicans in the Senate stupidly approved a bill that would extend the payroll tax for another two months, allow President Obama the leeway to approve the pipeline construction at his discretion, (which means it won't happen) and provides funding for another federal unemployment extension.

The GOP-dominated House refused to go along with this, as Speaker Boehner showed some courage for a change. The House wants a compromise that would extend the payroll tax holiday for an entire year,would force President Obama to veto the Pipeline bill, and allow the extension of unemployment benefits.

The President and the Democrats have so far refused to sit down and negotiate any of this. The last thing the president and his allies want, aside from lower gas prices is a long term tax cut, both of which provide less revenues for President Obama's domestic agenda.

The House Republicans made a huge PR error in not making the pipeline the sticking point rather than the payroll tax holiday. Instead, they should have compared the jobs and the savings at the pump to the estimated $40 per paycheck a family of four with a $50,000 income would save (about $160 total) as compared to the jobs and the more permanent lowering of gas prices, goods and services. To make it even simpler, they could have upped the ante and said "President Obama wants to save you about $160 for two months. We want to save you $1,040 by extending the tax holiday for a full year, plus the benefit of lower gas prices at the pump. Which would you rather have?"

That's what's going on,in a nutshell.I'm frankly amazed that the GOP leadership can't explain that for some reason.

Perhaps they ought to hire me in some capacity.

UPDATE, 2:00PM PST : I see where the House Republican leadership caved in completely. Idiots. And gutless ones at that.

please donate...it helps me write more gooder!

Tax cut cartoon

King cartoon

Tax cartoon

Tax cartoon

Tax cartoon

King cartoon