Current Events > Mortgages for homebuyers with good credit will cost more starting May 1st

(+) Yeah! (+)

https://finance.yahoo.com/news/mortgages-homebuyers-good-credit-cost-135954525.html

Those with bad credit will pay less. Good credit is considered more than 680.

wow

where money

I believe this is click bait bullshit. Even the article doubts it's true:

"It should be noted that the new rules have not gotten much play in the media other than conservative-leaning outlets like The Washington Times, New York Post and Fox News. GOBankingRates could not find anything on any official government website, including Fannie Maes, indicating additional fees for certain homebuyers, or how much they are. Most of the media coverage is based on the Washington Times reporting."

indica posted...

I believe this is click bait bullshit. Even the article doubts it's true:

"It should be noted that the new rules have not gotten much play in the media other than conservative-leaning outlets like The Washington Times, New York Post and Fox News. GOBankingRates could not find anything on any official government website, including Fannie Maes, indicating additional fees for certain homebuyers, or how much they are. Most of the media coverage is based on the Washington Times reporting."

It is talked about on every news website. We shall see come May 1st.

What a fucking joke. Because my credit is 827 and I pay all my bills responsibly, I have to pay more!?

DKBananaSlamma posted...

What a fucking joke. Because my credit is 827 and I pay all my bills responsibly, I have to pay more!?

About $40 more than someone with less than a 740 or lower credit score.

Suolevram posted...

About $40 more than someone with less than a 740 or lower credit score.

$40 * 12 months * 30 years = $14,400 more I gotta pay

What the fuck

We've seen how favoring risky loans has panned out before. If this is real, I'm just gonna take my money out of banks and buy gold that I bury in my back yard. It's less risky that way

Yea it's happening and anyone offered a FHSA loan can qualify. Imo it's a debt trap but no one cares about being over leveraged in this economy.

Let the crash commence.

All we'll get out of this is rich fucks taking out a lot of "cash" loans for some unknown reason, and buying a house outright. Then the concept will quickly leak down to the upper-middle-class.

Questionmarktarius posted...

All we'll get out of this is rich fucks taking out a lot of "cash" loans for some unknown reason, and buying a house outright. Then the concept will quickly leak down to the upper-middle-class.

you honestly think this will make mortgages more expensive than unsecured loans?

Seriously?

[LFAQs-redacted-quote]


Yea essentially you'll end up paying rent for the property to the government or fed in exchange for people defaulting on these loans. It's dubious.

g980 posted...

you honestly think this will make mortgages more expensive than unsecured loans?

Who says they're going to be unsecured?

No adult left behind

Questionmarktarius posted...

Who says they're going to be unsecured?

Ok why dont you just tell me about this mystery loan

g980 posted...

Ok why dont you just tell me about this mystery loan

There's a user around here who's constantly pissed off about the alleged loans the alleged rich get to avoid having actual "income", and a similar concept will quickly emerge for home-buying if it becomes cost-effective to do so.

when taking out a home loan of $400,000

The Zillow Home Value Index puts the typical home price in the U.S. at $354,649

I guess it mostly effects the rich, California, and New York.

I thought the entire purpose of having a good credit score was that you didn't have to pay as much on loans because you demonstrated that you're reliable. Is this just some kind of market manipulation bullshit to try and "fix" the housing market by locking out people who can actually afford homes?

DKBananaSlamma posted...

$40 * 12 months * 30 years = $14,400 more I gotta pay

What the fuck

With compound interest I'm sure you're paying a lot more than that.

It isn't just homes. I just bought a vehicle and my eyeballs almost popped out of my head when I saw the intrest rate. My credit score is 10 points away from perfect.

Thanks libruls

DKBananaSlamma posted...

$40 * 12 months * 30 years = $14,400 more I gotta pay

What the fuck

If your loan is more than $400k, yes.

The average home sale in the US is around $350K

I guess the concept is they are taxing the people that can afford it.

bigblu89 posted...

I guess the concept is they are taxing the people that can afford it.

im enjoying watching ce get mad about an objectively progressive policy

Isn't this a one time fee you pay at closing? Correct me if I'm wrong but this isn't something you pay monthly.

Edit: Maybe I'm wrong. I've seen it say it will cost more monthly and others say it's paid at settlement.

WrkHrdPlayHrdr posted...

Isn't this a one time fee you pay at closing? Correct me if I'm wrong but this isn't something you pay monthly.

From the article:

Under the rule, homebuyers with a credit score of 680 or higher will reportedly have to pay about $40 per month more than people with worse credit when taking out a home loan of $400,000, according to NewsNation, which cited a report from The Washington Times.

I asked my realtor about this and he was saying its mostly belong out of proportion.

His understanding is this knit applies to FHA loans. Those loans are as low as 3.5% down, require PMI for the life of the loan. Well qualified borrowers already go for conventional loans generally. Some high credit buyers do strategically use FHA loans because of the low down payment. This is really intended to just make the loan either less preferable to those already well qualified borrowers, or to get a bit more out of them.

So if you are conventional or VA, ignore it.

s0nicfan posted...

From the article:

Yah I just edited my response. I see there it says it's monthly but I saw it somewhere else that said it was paid at closing so now I'm just confused.

Ranting__Nord posted...

I guess it mostly effects the rich, California, and New York.

RIP me

bigblu89 posted...

If your loan is more than $400k, yes.

The average home sale in the US is around $350K

I guess the concept is they are taxing the people that can afford it.

Not much in California for 400k

Norman_Smiley posted...

His understanding is this knit applies to FHA loans.

So it's been meaningless feel-goodism this whole time, huh?

Yea I'd wait on buying any property right now your going to see some great deals in the fall.

g980 posted...

im enjoying watching ce get mad about an objectively progressive policy

I think you meant Progressive, capitalized. Using it in the non-capitalized form implies that progress is being made, which has precious little to do with the capitalized form of the word.

indica posted...

I believe this is click bait bullshit. Even the article doubts it's true:

"It should be noted that the new rules have not gotten much play in the media other than conservative-leaning outlets like The Washington Times, New York Post and Fox News. GOBankingRates could not find anything on any official government website, including Fannie Maes, indicating additional fees for certain homebuyers, or how much they are. Most of the media coverage is based on the Washington Times reporting."

Yeah that makes it seem questionable. We'll have to wait and see if this is real or not

Sometimes I really fucking hate this country lmfao.

eggcorn posted...

Not much in California for 400k

Well then I suggest you don't get an FHA loan if you buy property in California.

If what I read about this is correct, it's literally part of the "Tax the Rich" movement everyone's be clamoring for.

Questionmarktarius posted...

So it's been meaningless feel-goodism this whole time, huh?

That wasnt my take from it. FHA loans are generally meant for marginal first time owners. But you cant be over qualified for them.

Some borrowers use them strategically for reasons that are legal but not really the intent of the loan. E.g. buying places 3.5% down, doing the minimum residency requirements, and then selling or renting out, only to do it again, rather than moving onto conventional loans like most 2nd time owners would.

These borrowers also represent a unique risk profile the more typical borrower doesnt, mostly because they are viewing it as an investment rather than a long term home.

This move will push more well qualified borrowers into conventional loans. The flippers / investors will continue to use these loans, and pay slightly more.

And some high credit score low wealth borrowers will also pay more. But they will refinance into conventional 3-5 years into owning the place, so impact to them is still marginal, IMO.

Article isn't really clear. What fre exactly would this be?

Alright, so I looked into this more. This news is definitely being misconstrued.

People with good credit scores will pay more than they used to. But they still pay significantly less than that with bad credit.

Basically the "reward" for having good credit will be smaller than it was, and the "punishment" for having bad credit will also be smaller than it was.

That's a pretty big difference from how it's being presented, where people with good credit pay more than people with bad credit.

https://www.mortgagenewsdaily.com/markets/mortgage-rates-04212023