𝙉𝙚𝙬 𝙍𝙚𝙛𝙞𝙣𝙖𝙣𝙘𝙞𝙣𝙜 𝙁𝙚𝙚 𝘾𝙤𝙪𝙡𝙙 𝙏𝙝𝙧𝙤𝙬 𝙖 𝙒𝙧𝙚𝙣𝙘𝙝 𝙞𝙣𝙩𝙤 𝙩𝙝𝙚 𝙈𝙤𝙧𝙩𝙜𝙖𝙜𝙚 𝙈𝙖𝙧𝙠𝙚𝙩

Fannie Mae and Freddie Mac have announced plans to impose a new 0.5% adverse-market fee on mortgage refinances starting September 1, 2020.   

According to National Association of Realtors® President Vince Malta, “This is very disappointing, and the absolute wrong policy at the wrong time. This fee could cost homeowners thousands of dollars, which will destabilize the market and take away opportunity.”

“It also directly contravenes the administration’s own directives for federal agencies to do no harm to homeowners during the coronavirus crisis.”

“It is especially troubling since [Fannie Mae & Freddie Mac] use their profits from refinances to support home buyers in under-served markets – meaning those communities already suffering the most will be harmed the most by this action.”

“Home values and residential real estate are a rock for the American economy right now. We should do everything we can to lower costs for households during this crisis, not make homeownership more expensive.”

According to Expedian, one of the big three credit reporting agencies, the average mortgage balance is a little over $200,000. If someone decides to refinance their $200k Fannie Mae mortgage, it will cost them an additional $1,000. Some will say that this fee will be recouped by the lower monthly payments. That may be true, but consumers must understand just how long it will take them to recoup that $1,000 as they pay the lower monthly payment.

There are several online mortgage calculators that will show you just how much your monthly payment will be. Bankrate.com and Zillow.com provide good calculators, as well as others.

These calculators are also useful when you’re thinking of selling your home and/or buying another one. Visit our website at http://WestlakePropertySolutions.com to see how we can help.