While many buyers maybe getting their closing costs paid for, it’s not as if that money magically appears. The sellers may be giving it to the buyers but more often than not, it’s done as a gross up, where the seller give the buyers the cash but the buyer actually takes a larger mortgage. So either home sellers or home buyers pay - not the people who took out cash out refis to pay for a facelift.

I love to be contrary so here we go. The reality is that many of the buyers making purchases in 2009 will not have to pay their closing costs due to seller paid concessions. Those that do probably don’t have strong buyer representation.

And while I agree that it is generaly depressing to see that those who made the right decision are now going to pay for the mistakes of others, isn’t this always the way? (I know the cynic in you is saying yes right now.)

So we have to grin and bear it, but likely only for a short while. I see this as an attempt to regain investor trust. We all need the investor’s to feel comfortable making loans in the current market, so if this is how FNMAE FRMAC are going to entice the investors back into the business of making loans, so be it. Once things stabilize (towards the end of the third quarter) then we may see these penalties go away. (Can you tell I’m an optimist?)