Good Politics, Bad Policy: Take Action Now
Posted On: June 3rd, 2010 by James Posted In: Financial Health • Government Actions
There is a new Senate Bill that has recently been turned loose out of committee, and I believe that it is potentially disastrous for the Mortgage industry as we now know it.
The area of concern is amendment (SA. 3962) offered by senators Merkley (D-OR) and Klobuchar (D-MN) to S. 3217, the “Restoring American Financial Stability Act of 2010.” First let me start by saying that I’m personally ALL FOR financial stability, who isn’t? This Act is DEFINITELY passing later this year. Think of it like a political battleship that is unsinkable, floating through the rivers of congress. Every congress person is attempting to toss little bits and pieces of legislation onto the boat as it is certain to be approved into law. This amendment is one of those toss on pieces, and here is the gist of what it is trying to do:
The amendment will prohibit lenders from using bank rebates to pay for a portion of borrowers closing costs. The new law would have borrowers either pay for ALL FEES upfront, or ZERO FEES upfront, with no “in-between” option.
I believe that this will ultimately make mortgages more expensive for all concerned, and also become an additional pressure against property price appreciation. If you have ever received a mortgage and had some portion of your fees credited to you by the lender, then you have benefited from the way loans are currently priced. Additionally, this is an extremely “big-bank friendly” piece of legislation, and the big banks are much better positioned to survive an industry change such as the one proposed here.
Our company, Mortgage Trust, inc. has prepared 2 letters that I urge you to download, sign and return to either myself or your representative in US Congress. (if you send to me please indicate which congressperson should receive it ) One letter is prepared for homeowners, and mortgage holders, and the second letter has been prepared for Real estate professionals. If you are both, please fill out both, and pass these letters to your network liberally! Lets go national with this thing!
DOWNLOAD LETTER TO CONGRESS (CONSUMER VERSION)
DOWNLOAD LETTER TO CONGRESS (REAL ESTATE PRO VERSION)
4 Responses
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I Agree with Helen, especially when it is a bill such as the one proposed. When a bill is sure to pass, that is when all kinda of sneaky admendmants get tacked on. People don’t read about it or don’t want to make a fuss because they want to let the bill pass, but often that is when some of the worst legislation down the line is passed.
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Yes Helen, you are certainly right. It cannot be the case that mortgages become more expensive for all concerned. So we need to take action. But we also need to read what is the matter of fact and not believe in what others want us to believe. Everyone is supposed to think for him- or herself. Everyone is supposed to use the own mind. We have one after all so why not using it for once?
I think what is really important is for people to actually take the time to READ the bills- at least read the summaries. With all the rumors and out and out lies that run through the internet it is really important for people to not listen to the snipets of what others have to say with their interetations and their own personal agendas.I have already sent my letters.