Any mortgage lenders/banking folks that know about this apparent housing rule to take affect 1MAY?

[northwoods]

Last time it was the mortgage companies with their laugher no doc loans now the Fed is the one pushing unqualifies people into houses they can't afford - wait until people have to pay the taxes and all other expenses that increase along with the value of the house - plain stupid.

You are much too kind --- beyond stupid.

 

[ChandlerPearce]

You got that right. Essentially, if you have worked hard, saved money to accumulate a decent down payment percentage, paid your bills, etc., you are being charged a surcharge to offset mortgages made to less credit worthy individuals with minimal down payment percentages and poor credit scores and histories. In theory "to offset their loan delinquencies". This new law applies only to federally backed home mortgages and will not apply to cash buyers or those who obtain their loans through the private sector.

The cynical part of me questions how much of these "surcharges" actually make it to the average citizen? FHA has already changed it's terms to requiring PMI payments for the LIFE of the loan.....not the customary elimination upon 20% equity LTV.

 

[Nitneelyin]

not asking to get political, just seeking further information. first i've heard of this. The mortgage borrowing world is a gray space that i'm not well versed in. are there specific numbers/percentages or is it a flat fee? Any additional details? there are only like 2-3 articles that i've been able to find (since I dont' have the specific rule name to search, so it's all been boolean) and they're behind paywalls.

AGAIN, and i can't stress this enough.... i'm just looking for an understanding of this.

BL from a WSJ (take it with the usual partisan skepticism): "Under the rule, which goes into effect May 1, home buyers with a good credit score over 680 will pay about $40 more each month on a $400,000 loan, and upward depending on the size of the loan. Those who make down payments of 20% on their homes will pay the highest fees. Those payments will then be used to subsidize higher-risk borrowers through lower fees."

Yep, you work hard all your life to build up a great credit score and the government says, "Thank you", we're going to now penalize you and make you pay more, thanks to your good credit, so we can help subsidize risky loans.