In Concord,
New Hampshire, lawmakers in the State are considering ways to fill a $400 million budget hole in their upcoming budget, but one proposal calling for a tax on the refinancing of home and commercial mortgages, has bankers and property owners firing back.
Mortgage Broker Peter Simmons commented that, “The economy will not improve until we stabilize the housing market. A
mortgage refinance tax could potentially set New Hampshire back even further financially.”
Supporters of the tax in New Hampshire believe that with refinancing at an all-time high, a 1 to 1.5 percent tax would generate tens of millions of dollars in new revenue. However, proponents of the tax believe that it would be counterproductive to the recovery of the economy in New Hampshire.
Doreen White , President of the
Mortgage Bankers and Brokers Association of New Hampshire is concerned that “Our legislators seem to be going in the opposite direction by making it more expensive for homeowners to use the equity in their homes to pay for things like college education or property improvements. Some are just trying to make ends meet by lowering their payments.”
At 1%, the tax for refinancing under this plan would add an additional cost of $2,000 to the closing costs or tacked on to the loan of a $200,000 mortgage. While the amount may be minor, it could be the difference between some individuals being able to afford a refinancing, and others falling into foreclosure.
The spokesman for
Gov. John Lynch, Colin Manning said “The governor is examining ways that struggling homeowners could be protected from such a tax”.
The Mortgage Bankers and Brokers Association of New Hampshire recently threw their endorsement behind expanded gambling in New Hampshire as a possible solution to the State’s budget crisis. One of the groups that supports expanded gambling in New Hampshire, Rich Killion of
FixItNowNH said “This shows that the majority of people continue to turn their backs on an all-tax solution to the state’s budget problems”.
Many government watchdogs point to reckless spending as a primary driver in many state’s budget deficits, and believe that if the wasteful spending is put under control, that states may be in better positions.