CAMP was recently in Sacramento for our annual Lobby Day where we met with our elected officials at the Capitol to discuss mortgage-related matters. It is exciting to see the number of participants grow each year. Loan Originators and industry partners understand the importance of being engaged in the process that governs our industry at both the State and National level.
We have to pay attention! More than 130 bills are being considered that will affect your borrowers and your business. I’ll highlight a few of the worst and one of the best being proposed this year.
Senator Hertzberg has introduced SB 640 which would levy a service fee of 7.5% on most closing costs. Estimates are that 57,000 families would have been prevented from buying homes last year if this tax had been in place.
How about a $75 fee for every recorded document in the State of California? Senator Atkins proposes this with SB2, a bill first proposed by now-Congressman Mark DeSaulnier. It has been resurrected with a carve-out for purchases. As written, this bill would increase the closing costs on every refinance you do in the future. It would be even worse if both SB 2 AND AB 640 passes and there is a 7.5% charge on top of the recording fee…
They are taking another crack at eliminating the interest tax deduction, this time with AB 71, introduced by Assemblyman Chiu. Under the guise of supporting “Affordable Housing,” they would like to eliminate the second home interest deduction. This includes no mention of the impact on housing in vacation areas in California or those local economies.
Finally, here’s a beneficial one. Assemblyman Steinorth has introduced AB 53 which would allow taxpayers to make contributions to a homeownership savings account. It would work much like a health savings account with the savings tax free. There are income limitations, etc. but at least it’s a positive step in the right direction to help people save for a down payment.
Over and over, we heard about budget deficits, elimination of redevelopment agencies and the need for “Affordable Housing.” Unfortunately, it seems homeowners are expected to bear the brunt of the budget deficit and as an industry; we need to remain vigilant. Do the math on a couple of your recent transactions to see how any of the above proposals would affect your borrowers.
CAMP follows these bills closely and we need your help. Join CAMP, support the legislative efforts and when you see a “Call to Action,” respond! Our elected officials need to understand how their bills impact our homeowners -- their constituents.
-Audrey Boissonou
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