George's Blog

You may be aware that recently Congress extended the popular payroll tax cut until Feb 28th 2012. This is good news of course, however, they decided to pay for it by charging Fannie Mae and Freddie Mac (Congress's latest favorite whipping boys) extra fees on loans to pay for it. Well, everybody knows they are beyond broke; and the sh*t flows downhill, so the natural consequence is that they in turn charge the lenders higher fees they buy the loans from, The lenders then, pass the fees along to the consumers purchasing homes and refinancing right now. It is called the G-fee, short for Guarantee Fee, and comes to about a half point in fee, which translates into about .25 -.375% in rate.

So what this means is that 2 weeks ago the rates were at 3.75% for a conforming 30 year fixed loan, and now they are 4.00-4.125%, just like that. Thanks Congress! and they want to know why the Real Estate market refuses to improve--be sure to write to your local Member of Congress about it-

Hey, remind me to tell you why most people who got FHA loans before March 2011 can't refinance--