A new federal rule aimed at promoting affordable housing will cause homebuyers with good credit scores to face higher mortgage rates and fees.
The rule is designed to subsidize individuals with riskier credit ratings who are also in the market to purchase houses. The fee changes will take effect on May 1 and will apply to mortgages originating from private banks nationwide. Fannie Mae and Freddie Mac, the federally backed home mortgage companies, will implement the loan-level price adjustments (LLPAs).
According to experts in the mortgage industry, individuals with credit scores of 680 or more will face an additional cost of around $40 per month on a $400,000 home loan. Homebuyers who put down between 15% to 20% will face the most substantial fees.
Lenders and real estate agents anticipate that the rule will create dissatisfaction among homebuyers with excellent credit scores and homeowners looking to refinance. The reason is that the regulation penalizes them for their comparatively secure financial positions.
Ian Wright, a senior loan officer at Bay Equity Home Loans, told The Washington Times that the changes “do not make sense.”
“It overcomplicates things for consumers during a process that can already feel overwhelming with the amount of paperwork, jargon, etc. Confusing the borrower is never a good thing,” he said.
The rule will “cause customer-service issues for lenders and individual loan officers when a consumer won’t understand why their interest rate and fees suddenly changed.”
“I am all for the first-time buyer having a chance to get into the market, but it’s clear these decisions aren’t being made by folks that understand the entire mortgage process,” he added.
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19 Responses
What in the world? And no one has sued over this?
I wish hartzike RIP to all those who helped “Brendon” get in position to do this!
The evil forces will implode under their own sheer stupidity and pushing the envelope ala Haman and others like him. May it be soon in our times amen!
What a sick liberal piece of garbage!! I cannot believe that people call this a democracy! You’re penalized for being careful and watching your spending?? What type of nonsense is this?
They will not be satisfied till any trace of decency is destroyed !!!!
A goyish a cup!
No demoncratic process. I.e., Totalitarian.
Punishes personal responsibility and good behavior.
And plain old gezel.
This is insane. It’s upside down world.who here voted for this maniac?
We won’t be able to fund endless war in Ukraine and corporate bail ours if we don’t do this!!!! Bravo!!!
Another false headline by YWN
President Biden did not make or implement this rule
Sounds like a rule from Sodom.
“Another false headline by YWN
President Biden did not make or implement this rule“
In other words ctlawyer can’t find this article in any of his favorite left wing websites
I wonder why….
CTLawyer, if you got something to say, say it!
Sleepy Joe & the DEMON-RATS are really bent on destroying the housing market and the economy.
Time to rid ourselves of them.
a real chutzpa!
This article is mostly “fake-news”. Take a look at the LLPA chart on Fannie Mae’s website (https://singlefamily.fanniemae.com/media/9391/display), try to find one instance where someone with a higher credit score has to pay more than someone with a lower credit score (FICO).
This article also makes it sound like people who already have mortgages will see higher payments, that is not true at all.
It’s a little insane how so many people have such strong negative reactions without verifying anything.
I hope to be alive to see and watch Hashem patch him , Lapid , Bennet and a few more….we should not have to suffer the consequences of evil…far too many good kind chessed souls to deal with this woke garbage and sodom filled nonsense
> openmind4all
Contrary to your post, I don’t see anything in this article that says – as you state – those with a higher credit score will pay more than those with a lower credit. This article states that those with a higher credit score (and/or higher down payment) will pay more starting May 1 than they pay now. Even if they pay more starting May 1 that they pay now, they could still be paying less than someone with a lower credit score. It is the gap between the higher credit score and lower credit score that changes. So what you have to do is compare these rate (and fees) with the rates (and fees) as they were before May 1 and see the changes.
@georgeg
I don’t disagree entirely with what you’re saying, which is why I said “mostly” fake news. But I’m going to guess you are more familiar with mortgages than most ppl. I’m pretty sure most ppl who read this article think that higher credit ppl pay more than lower credit. Lines like this:
“The reason is that the regulation penalizes them for their comparatively secure financial positions.”
And this makes it sound like ppl’s existing payments are just going to go up:
“The rule will “cause customer-service issues for lenders and individual loan officers when a consumer won’t understand why their interest rate and fees suddenly changed.”