>The April Mortgage Rate Hike
JANUARY 11, 2012 BY MICHAEL SHETLER
Remember the fight in Washington last month over the payroll tax cut? After much dueling between the parties, John Boehner backed down and accepted a 2-month extension of the cut. That much was big news. What didn’t get reported was how the government is financing that tax cut extension.
It’s being paid by new borrowers.
All mortgages closing after April 11 will have extra fees attached effectively raising the interest rate by 1/10 of a point. The fees are paid to Fannie Mae and Freddie Mac, who turn the funds over to the US Treasury. According to this article in BusinessWeek, the additional fees will remain in effect for the next ten years.
While 1/10th of a point doesn’t sound like a lot, it will add about $18 to the monthly payment on a $300,000 loan.
So if you’re shopping for a home right now, there’s an incentive to close before April 12th.
https://ridgewood-nj-real-estate.com/the-april-mortgage-rate-hike/
