Mortgage interest rates to rise due to hidden fee

Loan fees are about to rise, and you won't even know it.  The fee in question is a guarantee fee collected by Fannie Mae and Freddie Mac that is part of the interest rate you pay.  It's not set forth on the settlement statement because it does not have to be disclosed.

According to the New York Times,

INSIDE the interest rate quoted on your home lies a small hidden fee that has been charged by government-sponsored entities like Fannie Mae and Freddie Mac for more than three decades. It’s an add-on rate known as the guarantee fee.

Everyone has to make a living, including Fannie Mae and Freddie Mac, don't you think?  But just think of the fees collected over the years that seem to have been squandered in the so-called "sub-prime crisis."  In any event, it means a small rise in interest rates is coming in the days ahead.

Read the full story here.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Stephen's Title Agency, LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-227-4724 - Fax 973-556-1628

E-mail Stephenstitle AT comcast.net - www.stephenstitle.com

Sometimes “let’s make a deal” works to sell a house.

Fairfield nj title agency refinance stephen's title agency llc

The New York Times Antoinette Martin writes about “Going Beyond Price Cuts” on February 12, 2012.

“A PERSISTENT recession in house sales has led to a surge in “concessions” for buyers. In listings and brochures, and most recently through a program started up on Zillow.com, real estate agents are trumpeting the news: even sellers who have reduced asking prices by a lot are often willing to do more.”

“That means contract concessions, in which sellers may agree to cover a buyer’s closing costs, provide a gift card for a certain amount, pay in advance for renovations, or even subsidize taxes by allocating funds from their proceeds at closing.”

One of the keys is that the seller has to be creative.  Taxes too high?  Pay some of them on a going forward basis.  Buyer is a little cash strapped?  Give them cash.

The house must still fully appraise, but, hey, isn’t that what life’s all about.

Read the full story here. 

Do you have a story about concessions?  If so, we’d like to hear from you.  Please post your comment below.



For your next title order or
Despite what you may have read to the contrary about concessions, “as long as concessions are written into a contract” and are clearly disclosed on the HUD Settlement Statement, … many banks in New Jersey are approving mortgage loans with up to 3 percent of purchase price in seller concessions.”  FHA loans can be approved with concessions as high as 6 percent.

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Stephen's Title Agency, LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-227-4724 - Fax 973-556-1628

E-mail Stephenstitle AT comcast.net - www.stephenstitle.com

Principal Reduction Will Solve The Housing Crisis and Jumpstart The Economy

Realty Times has a blow-out article written by Tanya Marchiol, President of Team Investments, an Arizona real estate broker.

The gist -

The American economy is chained to the crushing housing debt load. Chronic unemployment, foreclosures, and small business closings can all ultimately be traced back to the housing crisis. Working families across the country have seen their home values plummet, have had their life savings wiped clean, have been powerless to help when their loved ones lost their jobs, and in too many cases watched helplessly while they lost their homes to banks that continue to post billion-dollar profits and pay out billion-dollar bonuses. Add to that the trillions in bailouts and backstops that taxpayers gave to the banks, and one thing is clear: tax payers have already done their part. Now it is the banks' turn. Principal reduction will restore the American Dream, create jobs, and give the American family the ability to breathe again.

Ms. Marchiol is on to something here. We have heard many of the stories that she writes about. 

Read the full article.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Stephen's Title Agency, LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-227-4724 - Fax 973-556-1628

E-mail Stephenstitle AT comcast.net - www.stephenstitle.com

Revamping HARP, is relief finally on its way?

The New York Times writes, again, about HARP, the Home Affordable Refinance Program, that was introduced two years ago in an attempt to assist homeowners in refinancing their mortgages and reducing monthly payments.

In “A New Shot at Mortgage Relief” Mokoto Rich writes about William D. Compton.

“Like millions of other homeowners, William D. Compton would like to refinance his mortgage so that he pays less each month for his three-bedroom house in Gulf Breeze, Fla. With the savings, he figures he could afford a few extra movies and restaurant dinners or he could buy a new stove and brakes for his car, purchases he has postponed because finances are so tight.

“Although he would appear to be a good candidate, Mr. Compton, 57, has been turned down twice for a federal refinancing program aimed at homeowners like him.

“Still, he has renewed hope. That’s because the government is expanding the Home Affordable Refinance Program, which was meant to help homeowners whose mortgages are backed by the government and whose home values have declined sharply, even below what the borrowers owe. Mr. Compton is one of those underwater homeowners.”

When HARP was launched, it was estimated that it

“could help four million to five million homeowners whose home values had plunged. Yet just 900,000 borrowers — whose loans are owned by Fannie Mae and Freddie Mac, the government-sponsored housing finance companies — have successfully refinanced through the program. Starting early next month, though, banks will begin using new criteria intended to make more borrowers eligible: raising the ceiling on how much owners can borrow over the value of their home as well as relaxing rules that might force banks to take back bad loans from the government. In announcing the change, the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, carefully eased expectations, suggesting about 900,000 more homeowners would be helped, roughly doubling the size of the program to date.”

We have been critical of the Federal effort to date since the ceiling on property appraisal values was unrealistically low in New Jersey.

Time will tell if the changes to HARP will help New Jersey residents.

Read the full article.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Stephen's Title Agency, LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-227-4724 - Fax 973-556-1628

E-mail Stephenstitle AT comcast.net - www.stephenstitle.com