• Last modified 1981 days ago (March 19, 2014)


Mortgage fee phase-out could hurt before it helps

Staff writer

Because of the advancement of a Kansas Senate bill calling for the end of the state’s mortgage registration fee, property taxes could rise state and countywide.

“If this passes, taxes are going to go up and everybody’s going to have to pay whether you get a mortgage or not,” Marion County Register of Deeds Jo Ottensmeier said. “That’s not right.”

Currently, anyone taking out a mortgage in the state is required to pay .26 percent of the amount borrowed at closing.

The Kansas Bankers Association and Kansas Realtors Association saw the fee as a hindrance to homebuyers within the state, and pushed for a bill to end the fee immediately. Instead, the bill calls for the fees to be phased out over five years to offset an inevitable loss in revenue.

“They will decrease the amount in the mortgage registration fee, but increase the cost of each page to file,” Deputy Register of Deeds Rebecca Wingfield said. “So every year you’re going to be dealing with a new set of figures, which is going to have everybody confused.”

Ottensmeier said passage of the bill could cause a 1 to 1½ mill increase within the county just to cover its losses.

“Taxes will go up to make the difference,” she said. “If you can even go up enough to make the difference that you’re losing. To me it (the current fee) is just a fair user fee, but the bankers don’t see it that way.”

Wingfield said phasing out the fee would require new software for every computer that works on mortgage registration.

“Not only will we be losing a lot of money for the mortgage registration fee, but we will have to invest a lot of money to be able to do it on our systems.”

Last modified March 19, 2014