As a consumer with a good credit rating you may be asking: Do I have any options to avoid the higher interest rates and additional fees imposed by the Biden regime created to subsidize the financially irresponsible? The answer is quite possibly YES!
The hot topic of both mainstream and non-mainstream media has been the Biden regimes socialist housing scheme, under the guise of redistribution, to punish consumers who have made financial sacrifices. Consumers who have scrimped and saved, forgoing lavish vacations and other expenditures, to ensure they have good credit will see an increase in fees designed to reward consumers who are fiscally reckless. Many of these financially irresponsible consumers are afflicted with the cancer of entitlement per se, as they habitually and intentionally spend money well above their financial means and are often delinquent or fail to make payments as they have zero regard for their credit rating.
This outrageous decision follows the Biden regime’s decision, under the guise of redistribution, to punish blue collar workers by utilizing their tax dollars to pay off the student loans incurred by those who believe they should not bear the responsibility for their own choices. This socialistic decision punishes the American workers who either chose not to go into debt for a college education or did not have the financial means with which to do so. The appropriate action would have been to levy fees against colleges, holding them accountable for students who failed to graduate or were unable to obtain jobs that provided enough of a living wage with which to pay off their student loans.
On May 1st, a new federal rule which could easily be defined as socialism for homeowners, will upend the current structure of the Loan-Level Price Adjustment (LLPA) matrix. Home buyers with a good credit score may have their mortgage payment rise well over $60 a month, while riskier borrowers will receive more desirable mortgage terms because their fees will be reduced. Those who opt to put more money down upfront will also get slammed with additional fees. The Federal Housing Finance Agency (FHFA), which regulates federally backed mortgage companies Fannie Mae and Freddie Mac, stated this will address housing affordability challenges. The fact is this new regulation is discriminatory and potentially ineffective. This does NOT address the reality that risky borrowers are significantly more likely to default on their loans, which then adversely affects the stability of the economy and real estate marketplace.
The government already requires Private mortgage insurance (PMI) for conventional loans and a Mortgage Insurance Premium (MIP) for Federal Housing Administration (FHA) insured loans. This insurance protects the lender in the event the Borrower defaults. For financially responsible consumers, there are 3 possible avenues to avoid this additional insurance expense. This being said any other lending expenses, penalties or restrictions including, but not limited to additional fees and higher interest rates, should be levied based upon the borrowers financial credibility and not at the expense of others.
“In the short term, this may increase home ownership among the targeted group, but I’m afraid it could decrease home ownership among the middle class,” Jerry Howard, CEO of the National Association of Home Builders, told Newsweek. “I’m not sure that we’re not robbing Peter to pay Paul here.”
Are there alternatives available to the fiscally responsible consumer? Many consumers may wish to pursue alternative lending options such as an ARM (adjustable rate mortgage) or long term mortgage with more desirable terms in lieu of participating in the Biden regimes’ housing socialism program. At this time options are rather limited, however consumers with an excellent credit score, low debt to income ratio and adequate supporting income may be able to find private pr portfolio lenders who are interested in securing a steady stream of reliable revenue.
In the future is quite possible that large investors and other conservative lending institutions who are concerned about the volatility of the stock market, as well as the local and world economy, will start offering custom tailored mortgage products catering to fiscally responsible consumers who are tired of the Biden regime’s enabling and subsidizing of the financially irresponsible.
If you are looking to sell your home, I invite you to consider listing with Ohio Broker Direct. We have sold well over a Billion of Dollars in Real Estate and our For Sale By Owner listing options have saved our Sellers millions of dollars in commissions!
Respectfully,
Joan Elflein, Broker / Ohio Broker Direct
Ohio Broker Direct & its Brokers or Associates assumes no responsibility or liability for any errors or omissions in this blog, we advise all participants engaged in the buying or selling of real estate to enlist the services of a Real Estate Attorney.
