Well the G fee increase of 10 bps is starting to trickle down to the consumer. Wells today announced changes to pricing due to the increase. To save $20 in payroll tax mortgage prices will rise up to 80 bps. Or slightly more than .785% of the loan amount. Put another way on a $400,000 loan the cost of a similar rate will cost almost $4000! Nice job congress!
Wells Fargo wrote "In order for a loan to meet the April settlements, it must close by Feb. 29. The G-fee increase will worsen prices by up to 80 bps depending on note rate." (An 8:1 ratio? Come on...) Continuing, "Wells Fargo Wholesale Lending is staggering the impacts of that increase by Rate Lock Period in an effort to offer lower rates to consumers in the market for as long as possible. On January 11 the G-fee increase will impact 45- and 60-day pricing. You must begin calling Priceline for Rate Lock Extensions rather than extending online for Conventional Conforming loans (extensions will not be available online for Conventional Conforming loans), on 1/31 the G-Fee increase will impact 30-day pricing, and on 2/13 the G-fee increase will impact 15-day pricing. Conventional loans locked prior to the dates above must fund by Feb. 29 - no standard extensions. If the loan extends, you will be charged 55 bps to cover the G-fee plus normal extension fees. Non-Conforming pricing is impacted since pricing is set as a spread to conforming base price."
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