Welcome to the first installment of Two Cents Tuesday where we talk about money items in the news.
First, the Department of Education extended the Federal Student Loan forbearance program from the CARES Act. It was set to expire December 31, 2020 but was extended one more month, to January 31, 2021, so that President-Elect Biden and his administration can decide what they are going to do with student loans.
It looks like you will have to pay the student loans soon so hand onto that money and don’t buy another tv this holiday season!
The second item to note is that a new fee was added to new mortgages starting December 1. 2020. The fee is 0.5% and added to all new mortgages backed by Fannie Mae and Freddie Mac. It is suspected that the banks will pass this fee to consumers. The banks may add the fee to the quoted interest rate or they may charge you at closing on your new home.
So, when you are asking several banks what their interest rate is, be sure that you ask if this 0.5% fee has been added. You want to be sure to do an apples to apples comparison. Also, if the bank is not backed by Freddie Mac and Fannie Mae, then there will not be this fee.
The last item to note in Two Cents Tuesday is holiday shopping. This is the year to reset your budget and spend only what you can afford. Notes and letters of gratitude are more valuable this year than ever.
Thanks for joining us for Two Cents Tuesday! Subscribe to our channel or visit our website at Smart and Sassy Money. See you next week.