No one should be surprised that our backwards thinking General Assembly has raised fees on mortgage lenders as the housing market struggles to regain traction after the housing bubble burst. In addition to raising fees on mortgage lenders and brokers, SB1216, which amends the Emergency Program to Reduce Home Foreclosures Act, creates the temporary State Home Foreclosure Prevention Trust Fund. The bill also implements temporary fees on mortgage servicers.
Sen. Dan Blue (D-Wake) is the primary sponsor of SB1216 and Sen. Bob Atwater (D-Chatham) is a co-sponsor. The bill passed overwhelmingly in both the NC House and Senate and was signed by Governor Perdue.
By raising the required filing fee for mortgage brokers and lenders from $125 to $300, the General Assembly has ensured that obtaining a mortgage will be more expensive. Furthermore, the bill requires that licensed mortgage lenders, brokers and servicers must pay an annual renewal fee of $625. Fees paid to the state, like corporate taxes, are ultimately paid by individuals through higher prices.
Citizens looking to purchase homes may not notice these hidden costs, but they will be factored in. Mortgage lenders, brokers and servicers will feel the effects of these fee increases on their bottom line. In an economy such as this, credit should flow more freely – not less freely.
For imposing burdensome fees on an especially downtrodden sector of the economy, SB1216 is this week’s bad bill of the week.