How to save a couple of hundred by spending over nine-thousand... aka, the Obama Administration pulls a fast one on homebuyers

Spend $9,500.00 and save a couple of hundred...huh? How's that work out?

Back in December (2011) I scanned an article by the Associated Press concerning a fee that would be attached to new mortgages. I didn't give it much thought at the time due to a number of reasons...but oh how I should have! I picked up on it a bit by catching a segment of the Andrew Wilkow XM radio show while driving into town earlier today. Thanks to Andrew for shedding new light on this shadow tax or should I even call it rip-off-number-one to all future home buyers...and present buyers if they plan on refinancing. In esscence the politicians pulled a fast one on the American people by telling them they would continue to get a tax break for another two months while at the same time socking it to all home buyers for the next ten years in order to pay for the tax break...and even that's not quite correct because the added fee (actually a tax) will go directly back into the U.S. Treasury with no accountability (that means the politicians can spend it any which way they want.
Rather than me explain the big picture a went back to find last December's Associated Press article and with the aid of the Wilkow news letter (delivered free daily) was able to add the CBS video below. ~ Norman E. Hooben
ps: Don't let anyone kid you, this rip-off was designed by the Obama people but the news media will attempt to cover that up. ...and pay attention where they hide that fee, it's explained in the video.

The following from the Mecklenburg Times

Payroll tax cut will boost costs of new mortgages

By The Associated PressWASHINGTON – Who is paying for the two-month extension of the payroll tax cut working its way through Congress? The cost is being dropped in the laps of most people who buy homes or refinance beginning next year.

The typical person who buys a $200,000 home or refinances that amount starting on Jan. 1 would have to pay roughly $17 more a month for their mortgage, thanks to a fee increase included in the payroll tax cut bill that the Senate passed Saturday. The White House said the fee increases would be phased in gradually.

The House of Representatives on Tuesday rejected the Senate version, putting the legislation in limbo.

The legislation provides a two-month extension of a payroll tax cut and long-term unemployment benefits that would otherwise expire on Jan. 1. It would also delay for two months a cut in Medicare reimbursements for doctors that is scheduled to take effect on New Year’s Day. Two more months of the Social Security tax cut amounts to a savings of about $165 for a worker making $50,000 a year.

To cover its $33 billion price tag, the measure increases the fee that the government-backed mortgage giants, Fannie Mae and Freddie Mac, charge to insure home mortgages. That fee, which Senate aides said currently averages around 0.3 percentage point, would rise by 0.1 percentage point under the bill. The increase will also apply to people whose mortgages are backed by the Federal Housing Administration, which typically serves lower-income and first-time buyers.

The higher fee would not apply to people who currently have mortgages unless they refinance beginning next year.

Because of the weak housing market and the huge numbers of foreclosures in the last few years, private insurers have not competed strongly for business with Fannie and Freddie, which have the backing of the federal government. As a result, about 9 in 10 new home mortgages are backed by Fannie, Freddie and the FHA.

President Barack Obama and many congressional Democrats and Republicans want to curb Fannie’s and Freddie’s dominance in the mortgage market. Obama earlier this year proposed raising the mortgage guarantee fees they charge as one way to do that.

The ethics committee determines whether House members violated standards of conduct, including a virtual ban on gifts. The committee also can refer cases to the Justice Department for a criminal investigation.

It was previously revealed that Sen. Kent Conrad, D-N.D., and Chris Dodd, D-Conn., while still a senator, had received VIP loans from Countrywide. Both said they did not know they were getting unique deals, and Dodd maintained he received no preferential treatment.

Others named as recipients of the VIP program were James Johnson, former head of Fannie Mae who later stepped down as an adviser to Barack Obama’s first presidential campaign, and Franklin Raines, who also headed Fannie Mae. Still other “friends” included retired athletes, a judge, a congressional aide and a newspaper executive.

The Senate’s ethics committee looked at the Dodd and Conrad cases and cleared them of wrongdoing but warned that they should have exercised better judgment.

The committee said the senators should have questioned why they were in the VIP program, because it should have raised red flags.

The Securities and Exchange Commission in October 2010 said that Mozilo would pay a $22.5 million penalty to settle charges that he and two other former Countrywide executives misled investors as the subprime mortgage crisis began. Mozilo also was banned from ever again serving as an officer or director of a publicly traded company.

He also agreed to pay another $45 million to settle other violations for a total settlement of $67.5 million that was to be returned to investors who were harmed.

The following from CBS News