One firm emotionally described the fee as a “total cash grab by the federal government” and Bob Broeksmit, President and CEO of the MBA, was very clear and to the point when he said, “The implementation timeline is intentionally punitive and absurd and while it’s true that millions of borrowers nationwide requested forbearance on their mortgages since the pandemic began, that number has been falling in recent weeks”. Part of the discontentment has to do with the extreme lack of communication – with most arguing that Fannie and Freddie should have issued a longer notice period. In 2007 Fannie Mae imposed a 0.25% surcharge on all mortgages it bought from lenders in response to the great recession. While the fee is being met with much disdain, such fee increases are not unprecedented. Critics argue that the pricing increase will be particularly harmful for our nation’s low-and-moderate-income homeowners and for the emerging, but unsteady, improvements to the national economy. The Mortgage Bankers Association estimates that the fee will amount to around $1,400 per loan on average. Importantly, this fee is not applicable to purchase loans. Both Fannie Mae and Freddie Mac requested and were granted permission from the FHFA for the change which the GSE’s implemented as a result of risk management and lost forecasting precipitated by COVID-19 related economic and market uncertainty. Mike Carnes, Managing Director, MSR Valuations Group Announcement and Industry FeedbackĪnnounced on August 12th and applied to all refinance mortgages with settlements dates on or after September 1, 2020, both Fannie Mae and Freddie Mac will begin charging a 0.5% adverse market fee on most refinances (including both cash-out and rate-term refinances). Research Insights: The Impact of the Agency’s New Adverse Market Feeīy Dick Kazarian, Managing Director, Borrower Analytics Group
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |