Dec 20 2007
Refinancing Mortgage Fees Changing
In a piece of not so nice news, Fannie Mae has begun to raise its fees. Freddie Mac may follow close behind. A 0.25% fee has been added to all new mortgages bought or guaranteed, due up front. This means an extra $1000 fee on a $400,000 home. Tough luck for those already feeling the credit crunch and looking to refinance before their ARM rates increase.
Another not so exciting tidbit of information comes in the amounts you may qualify for from Fannie Mae and Freddie Mac. If you would have qualified for a 100% loan, you will only be allowed to take out a 95% loan. All home loan mortgages will be reduced by 5% because of the declining home market.
Finally, the two have decided to impose a 1.25% penalty on borrowers with a credit score below 680 and borrowing more than 70% of the home’s value. There is a slim chance if you shop around you may be able to borrow through Fannie and Freddie and still avoid the surcharge because it only applies to loans that they purchase from other mortgage brokers. Chances are, however, that the fees will be passed on to us.
All in all, I think we all knew the market was going to get tougher to deal with. Fannie and Freddie have raised costs to the borrowers, us, but they are doing so to cover their risk with the volitile housing market.
Amazing post,
Refinancing for a fixed rate mortgage can lower your rates and give you peace of mind. By setting your mortgage rate today, you know exactly how much your interest will cost and how long your loan will last. Fixed rate mortgages also allow you to buy down the rate, saving you thousands if you keep the mortgage for several years. You can also extend the loan period to reduce monthly payment amounts.
Fixed rate mortgages also allow you to buy down the rate, saving you thousands if you keep the mortgage for several years.
http://www.johnbeckland.com/