Fee serves a function
The Kansas Bankers Association is leading a charge in Kansas to eliminate a mortgage registration fee that is collected when real estate mortgages are filed in the Register of Deeds offices in the state of Kansas. In articles being written and presented to the media, they contend it is an unfair fee.
This fee is collected when a mortgage is brought to be recorded. It amounts to 0.0025 multiplied by the amount of the mortgage. The money from this fee is deposited into each county's general fund and is used for paving and maintaining county roads, elections, the county health department, landfill operations, various county office operations and many other county functions.
The Kansas Bankers Association talks of a "level playing field." I guess to them this means borrowers who come to them pay a fee to record mortgages some other lenders are not required to pay. If someone borrows from the Small Business Administration or other federal entities, there is no fee that is to be paid. If a party borrows from the Farm Credit lenders, usually no fee is to be collected. I suppose the Kansas Bankers Association thinks if those who borrow from them did not have to pay the fee, the field would be level. I suppose they believe if their borrowers did not pay this fee, more would come to them and they could have a little more profit.
This is not a level playing field issue; it is a profit issue for Kansas bankers. The message being presented by the Kansas Bankers Association sounds like they are sitting around their fireplaces in the cold winter evenings in their Fred Rogers cardigan sweaters thinking of how they can save the Kansas taxpayers a little bit of money. If that were the case, I wonder why there is such a difference between how much the Kansas taxpayer gets paid from the embarrassingly small interest rate on his money in his savings account and yet pays much more in interest if the time comes to borrow.
Kansas bankers provide an important and necessary service for Kansans, but maybe the Kansas Bankers Association should think about the Kansas taxpayer and narrow the gap between savings rates and lending interest rates and level that field.
The revenue lost by the counties of this state if this fee is eliminated would be substantial. The revenue collected by all Kansas counties each year from this fee amounts to approximately $47 million. How would that amount of money be replaced? Who would now have to pay to level the field for the Kansas Bankers Association? What services would have to be cut to help the Kansas Bankers Association and its profit margins?
This is a fee that has been part of Kansas law since the 1920s and is a means of counties collecting revenue for county operations. Raising property taxes to replace it or cutting services to help with the loss of revenue would affect many more people than just those who are making real estate loans.
Everyone would like to pay fewer fees, but eliminating this one would be harmful to Kansas counties. Contact your local state senator and representative and urge them to vote against any effort to repeal this necessary fee.
Robert Keesee is Register of Deeds
in Phillips County.