The Federal Housing Finance Agency has announced targeted changes to Fannie Mae and Freddie Mac’s (the “GSEs”) guaranteed fee pricing by eliminating upfront fees for certain borrowers and affordable mortgage products, while implementing targeted increases to the upfront fees for most cash-out refinance loans
As part of the pricing changes stemming from the FHFA's ongoing review of the GSE’s pricing framework announced last year, FHFA is eliminating upfront fees for:
- First-time homebuyers at or below 100 percent of area median income (AMI) in most of the United States and below 120 percent of AMI in high-cost areas.
- HomeReady and Home Possible loans.
- HFA Advantage and HFA Preferred loans.
- Single-family loans supporting the Duty to Serve program.
“FHFA is eliminating upfront fees for certain first-time homebuyers, low-income borrowers and underserved communities to promote sustainable and equitable access to affordable housing,” FHFA Director Sandra Thompson said. “Today’s announcement will result in savings for approximately 1 in 5 borrowers of the Enterprises' recent mortgage acquisitions.”
The new fee reductions will go into effect as soon as possible, according to the FHFA. The implementation of new fees for cash-out refinance loans will begin Feb. 1, 2023, to minimize market and pipeline disruption.