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By G. Steven Bray
I read an interesting article the other day that claimed that all the new mortgage regulations have saved you money. Feeling richer? What a bunch of bull.
Every honest analysis I’ve read about the effects of the new regulations, and by honest I mean ones that aren’t poorly disguised advertisements like this one I read, shows the regulations have increased costs by 30 to 50 percent. Sure, as the article states, you can get a no-closing-cost mortgage now, but you could do that before the regulations went into effect. And do you really think everyone loves you so much they’re all working for free? All those costs, those higher closing costs, are getting built into your interest rate. I recently read a report that estimated the regulations have added as much as 0.5% to the interest rate of every mortgage. Over the life of a $200,000 loan, that means you’re paying an extra $20k because of the new regulations.
Now, I’m not suggesting we overlook the excesses of the last decade, but I am calling bull**** for what it is. Maybe it’s time we become more careful about the excesses of regulation.