The extension of the payroll tax cut was approved by congress in late 2011. To fund this extension they tapped Fannie Mae and Freddie Mac to foot the bill. In the next couple of months, Fannie and Freddie will be adding a premium to the rate on every loan they insure to pay for this temporary extension.
Costs for $100,000 loan equals approx. $500.
Costs for $200,000 loan equals approx. $1000.
If you or someone you know is planning to get a new home mortgage, you may want to consider acting on the opportunity before the additional expenses are applied.
If you are in the process of getting a new loan and your payment is currently locked in you can avoid the increase if your loan is closed before mid-February.
If you have already closed on a new low interest rate in the past 24 mos and have no need for additional financing right now you will not need to worry about this fee.
Call my office if you have questions and schedule time to discuss the best options.
