Middle Class Payroll Tax Cut Extension Comes Courtesy of Mortgage Fees on Home Buyers
**Written by Doug Powers
During the clamor to pass an extension of the payroll tax cut, President Obama asked “What does $40 mean to you?”
His opponents of the way the extension was handled might now be able to counter with, “What does $9,500 mean to you?”
(CBS News) Just before Christmas, American workers got a rare gift from Washington politicians – the current payroll tax cut would be extended for two more months. At the time, both President Barack Obama and House Speaker John Boehner lauded the move to avoid a tax increase for millions of working Americans. But there’s something the politicians weren’t bragging about – the fact that they’re paying for the two-month tax cut with what has turned into a brand new fee on home buyers.
The new fee is a minimum of one-tenth of 1 percent on Fannie Mae- and Freddie Mac-backed loans, and is likely to go much higher. It will be imposed for the next 10 years on most mortgages and refinancings and it lasts for the life of the loan. For every $200,000, it amounts to an extra $15 dollars a month.
It’s bad news for Patty Anderson, who’s buying a home in Virginia. Anderson will save a couple hundred dollars from having her payroll tax cut extended but her mortgage broker told her the new fee would cost her almost $9,500.
[...]
The $35.7 billion collected in fees won’t go into the Social Security fund to replace the lost payroll tax. It goes to the general treasury where Congress can spend it however they please.
Is this outlined in the Homeowners Bill of Rights?
For now, file this under “robbing Peter for decades to pay Peter for a couple of months”:
**Written by Doug Powers
Twitter @ThePowersThatBe
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As mentioned on the last thread. A tax break may be temporary, but a tax increase is forever.
“So under which of the three cups do you think the pea is hiding?”
To repeat my comment, it’s only a paperwork exercise anyway. The current surplus is already spent as part of the general fund, and before long the shortfall will have to be made up from general revenues.
Well isn’t this special? Every stinkin day we find new taxes/fees added to things to stop growth of home ownership or busines growth here in America! The stinkin feds will get their pound of flesh one way or the other won’t they?
BTW, have you seen this on our military? Gads, this just makes me sick. Cut this so they can fund more food stamps or un-employment for three years?
http://www.armytimes.com/news/2012/02/military-prorated-imminent-danger-pay-starts-this-month-020212w/
L
Biteme: The Volt failed because we didn’t spend enough! This will fix it!
Aarrgghh!
Remember, anyone who answers anything but “none” has been fooled. There is no pea. There is no product whatsoever. We have all been taken to the cleaners. And anytime CONgress is in session, put down the remote and grab your wallet.
Looks like Obandit is not just smoke’n'mirrors anymore, he’s added sleight-of-hand to his repertoire. The towncrier-in-chief shouts as loud as he can that he’s all for bolstering the housing market and helping people refinance to get out from underwater and avoid foreclosure, but he’s shaking your hand only to distract you while Opickpocket’s other hand is reaching into your pocket or purse and swiping your wallet.
Louie Kritski: GOSH, LIFE STINKS!
Tenant: And then you die!
Louie Kritski: I’m doubling your rent, meathead!
Tenant: Good. That makes two bad checks I have to write!
Light, smoke, and mirrors.
the tax cut is for two months, and the fee is forever, wtf?
Obamsian Economics:
If you can afford to buy (or re-finance) a house, you’re rich and deserve to have your wealth redistributed.
Yessiree! This new fee on mortgage loans should be just the ticket to get the housing market going again!
We could fix our economy almost immediately by opening drilling in this country. ANWR, the pipeline, the Gulf, etc. Presto…instant economy boost, with the added bonus of giving the Middle East a giant middle finger!!
This needs to be a HUGE issue with our candidate! DRILL, DRILL, DRILL!! The stupidity of being held hostage by a bunch of greenie morons infuriates me!!
Of course there is nothing in the story saying just how much these fees will increase of the 2 year phasing in.
Obama agrees with you. Right on schedule, at the beginning of an election year, suddenly the Gulf is wide open for new leases and permits. Of course, after the election, the EPA will resume (or continue) their efforts to ban fracking.
Reminds of the legendary Edwin Edwards, Gov. of Louisiana, and crook. When time was running out for matching Federal funds for highway projects, and LA didn’t have the funds or the time to use the matching funds,Edwin did the logical thing (in his world). He sold them to California, for some percentage of their worth. And it was legal.
And it moved the funds from being tied to highways to being general funds.
Genius.
and @SShat.
Who was I talking about, again….?
So many government backed programs fail because “we didn’t spend enough”! The Volt is only a microcosm of government’s continued wasting of taxpayer funds which has been continually excellerating since at least LBJ’s Great Society programs, hitting warp speed in the years of this admin.
And more tax dollars will always “fix it”. There will never, ever, be enough tax dollars for our politicians to spend.
He won’t even wait until the election. All he has done is open it up for new leases and permits he never actually said any would be granted. Of course the media will only report that the first statment and never follow up on the results.
The gov doesn’t need another way to squeeze the home purchasing public. We’re now getting it from all sides. I wish anyone needing to sell their homes, lots of luck. Time to pay cash and leave the banks and gov out of everything. Or at least until the gov makes cash not worth the ink and paper used to make it.
So some people are starting to realize govt. gifts, especially those to the middle class, are not free? Just wait until they see the bill for free healh care.
Sad fact is SS has already been running a shortfall for the past 2-3 years, around $50 billion last year with it rapidly mushrooming into hundreds of billions within 10 years. The time to fix this without massive pain is long past. Congress is whistling past the graveyard and hoping it collapses after they are out of office and safely vested with their Federal Employees Retirement Plan and escape the wrath of the public demanding an end to this racket.
I’ve had that argument with Obama supporters. The don’t grasp the difference between granting leases and issuing permits for exploration and drilling. The Shell fiasco in Alaska is a perfect example. $4 billion to buy the leases and do the preliminary surveying, and then the government refuses to issue permits for drilling. And now they wonder why oil is so expensive.
Oh…so you must be one of those EVIL republicans that want dirty air and water! /sarc
Bartender! A clean glass of dirty water please!
Not to mention that are refining capacity is the same now as it was back in the 70′s as the “greenies” have blocked any new refineries from being built.
Ho wonderful! I just signed everything last friday to Refi my mortgage.
As far as I’m concerned, there’s nothing wrong with Washington that a few nuclear devices can’t fix. :p
Well of course how else are we going to get all our vitamins in minerals in one drink
What the he11 does $40 matter, when the government is driving us into debt at a rate of roughly $10,000 per year per taxpayer? That has to be paid back, with interest, if not by us, then by our children and grandchildren. It’s either that or outright collapse of the system. If you witless Democratic drone voters get your way, it will be the latter.
Thinking of an old saying, “I am so mad I could spit nails!”
So then, when did Boehner know about the “fee”?
Is this another “pass-it-to-know-what’s-in-it” thing?
Don’t think I’ll hear this in a televised debate from any of the R’s.
Yep, another check mark in the “Term-Limits” column.
From the article:
From the sounds of it Boehner knew about it the whole time.
(note. West did vote for the bill in the end).
I wonder in this redistribution scheme. If everybody is supposed to be equal then how does that work when children move out of the house?
If a family of 4 with one wage earner makes $50,000 a year, when the 2 kids move out, do they now also get to make $50,000 a year? Or are they supposed to get less because they are not as old as the father?
What is the “scale” of pay by age of worker (assuming they even work)?
Also, if the youngster can make much more than the Dad, does the kid get to make $100,000 or is he limited?
And if he isn’t as smart or as capable as the Dad or sibling, does he also get a reduction for capability as well as age?
Who determines how much each should make?
This redistribution stuff can get pretty complicated. If government gets to make those decisions, then the government will be picking winners and losers on what criteria exactly? Skin color, age, sex, national origin, religion, sexual orientation, grades, location?
It’s impossible for government to do that equitably and without corruption.
Impossible, yet that’s what food stamps, welfare, free health care, graduated income tax, etc are attempting.
It’s obvious you want to be on the top of that food chain making the decisions instead of receiving them. Does everybody get to be the ones making decisions or just a select few? Oops, back ot the beginning again. Inequality. A vicious cycle.
Yes!! And I want dirty, unsafe food for my grandkids too. I mean, that goes without saying. Pelosi was right…Republicans do not want this country to have safety standards. Remove all the regulations! E-coli tastes so good with a worm burger!
Redistribution is trickier than you think- just ask Dennis Moore:
http://www.youtube.com/watch?v=qLkhx0eqK5w
I love the final scene where he is down to comparing the change in everybodies pockets and making sure everyone has the same amount. Priceless
The Boy-king is taking money our of the SSI fund and replacing it with money in the general fund. In the old days we called that money laundering.
Just heard on the news that the effort to extend the “payroll tax cut” from 2 months to 12 months has hit a snag- they can’t agree on how to pay for it. WTF? Where is the money they are getting from the mortgage fee going? I totally detest democrats. I forsee democrats chipping away at Social Security taxes and replacing it with higher taxes on other things (and evil rich people) til they reduce the tax burden on at least 51% of the people to zero- guaranteeing them continuous control from that point on. The majority can then vote for democrats who promise them more and more goodies, all funded by a smaller minority that will not be able to manage the votes to prevent being rolled.