state + local

They should absolutely be liable for paying this tax. Each and every citizen is required to do it upon sale of their property. Bogus that they can even try to claim an exemption on this.

Local government suing federal government. We sure are efficient. It's a mystery how we rack up trillion plus dollar deficits.

Fannie may and Freddie Mac are not government agencies, they were publicly sponsored but are otherwise private corporations. And like any corporation, they want to follow only the rules and laws that suit them. When it comes to taxes they'll claim to be a government agency, but the instant being a government agency is inconvenient, watch them suddenly recall that they're private companies.

@furry1 they have required over 300B of taxpayer money for bailouts and losses related to the housing bubble THEY created and the housing bubble that the government fostered by using HUD to mandate that fannie and freddie hold a certain % of their assets as subprime. They are a branch of Dodd, Frank, and Waters demanding that more people own homes.

"THEY created and the housing bubble that the government fostered by using HUD to mandate that fannie and freddie hold a certain % of their assets as subprime."

Could you please site the HUD mandate that required any bank — ever — to hold a certain percentage of their assets as subprime? Could you link the legislative regulation that even mentions subprime (prior to 2007)? Do you know ARMs had more to do with the housing collapse than did subprime mortgages?

Maybe the fee should go back to the home buyer since the closing costs are loaded with questionable garbage fees, surcharges, insurances, etc. For all the costs that are included on a closing statement, they missed charging for the airspace above the house.

I am surprised this hasn't been settled one way or the other since they first started operating and foreclosing.

beebee82 - Ever heard of the term or practice "redlining"? This was done in the 1930's so banks could insure their loans based on risk. On the surface it appeared to be racist... the reality was the redline areas had the highest risk factors for default. In the 1960's it was proven that banks abused this practice in part and was found to be racial discrimination. THUS the Acts - Fair Housing (1968) and The Community Reinvestment (1977). Have no idea of what all of the regulations in these Acts are but it is certain banks had to carry these higher risk loans... google yourself. One example of failed a bank...due to misguided government/feelgood regulations... ShoreBank, a community-development bank in Chicago's South Shore neighborhood, was a part of the private-sector fight against redlining. Founded in 1973, ShoreBank sought to combat racist lending practices in Chicago's African-American communities by providing financial services, especially mortgage loans, to local residents. Many sources characterize ShoreBank's efforts as overwhelmingly inspirational and successful. In a 1992 speech, then-Presidential candidate Bill Clinton called ShoreBank "the most important bank in America." On August 20, 2010, the bank was declared insolvent, closed by regulators and most its assets were acquired by Urban Partnership Bank. My guess is this failure was due to loaning money to those who were too high of risk. Much like Freddie and Fannie is a total failure for backing subprime loans. Just the facts!

"THEY created and the housing bubble ", I think not, People taking out loans they could never afford created the housing bubble, the banks just looked the other way and helped facilitate the issue. I like how some people always point at the banks for creating the problem, people need to take a very long look in the mirror and maybe then they will see the problem.

And is it no surprise that a demographic that has historically experienced higher poverty rates was again taken advantage of by institutions with the advent of the Adjustable Rate Mortgage? No governmental regulation ever told banks, "Go out and make these higher-risk mortgages, and after five years, jack up those rates by a good 10-15 percent so they have zero ability to pay them off!!"