New FHFA Fees Introduced

January 11, 2022
Fees for high balance loans will increase between 0.25% and 0.75%, while second home loans will see an increase between 1.125% and 3.875%.


The Federal Housing Finance Agency introduced new upfront fees for some high-balance and second-home loans sold to Fannie Mae and Freddie Mac. Upfront fees for high balance loans will increase between 0.25% and 0.75%, tiered by loan-to-value ratio. For second home loans, the upfront fees will increase between 1.125% and 3.875%, also tiered by loan-to-value ratio.  The new pricing framework will take effect April 1, 2022, to “minimize market and pipeline disruption,” the agency said in a press release. First-time homebuyers in high-cost areas whose incomes are below 100% of the area median income will be exempt from the new high-balance upfront fees, although only a small number of those borrowers seek second homes and high-balance loans. In a statement, FHFA Acting Director Sandra Thompson said the fee increases are another step FHFA is taking to both strengthen the government-sponsored enterprises’ safety and soundness, and ensure access to credit for first-time homebuyers and low- and moderate-income borrowers.  Mortgage Bankers Association President Bob Broeksmit said he appreciated the delivery date for the new fees is in April, which gives lenders more than 90 days to adjust their rate sheets appropriately.  He also said he expected that this announcement would not be the last word on pricing adjustments, and that it sets the stage for reducing loan-level price adjustments for first-time borrowers, and those facing higher fees due to the loan-to-value ratio or their credit score.

Source: HousingWire