On January 26, 2018 NAR sent a letter to FHFA Director Watt and his staff requesting a review of guarantee fees (g-fees) in light of recent tax changes. The letter notes that corporate tax rates were lowered as part of the Tax Cuts and Jobs Act, that the FHFA had previously based their g-fees on a “target rate of return”, and that if g-fees are not lowered to reflect the lower tax rate, realized returns will eclipse the FHFA’s target return.
NAR Letter to FHFA Director Mel Watts Regarding Tax Cuts and Jobs Act
Issue Date: January 26, 2018
On January 26, 2018 NAR sent a letter to FHFA Director Watt and his staff requesting a review of guarantee fees (g-fees) in light of recent tax changes. The letter notes that corporate tax rates were lowered as part of the Tax Cuts and Jobs Act, that the FHFA had previously based their g-fees on a “target rate of return”, and that if g-fees are not lowered to reflect the lower tax rate, realized returns will eclipse the FHFA’s target return.
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