Mortgage Foreclosure & Refinance Resource

This month, Fannie and Freddie increased the fees they charge lenders for many loans, effectively bumping up interest rates for many borrowers who have marginal credit. The companies also tightened their policies on refinance loans that enable an owner to take cash out of a home.

Fannie Mae was the first of the two mortgage companies to increase its fees for lenders, doubling its current charge on most loans, to a half of one percentage point, and Freddie quickly followed with similar fee changes. Professionals expect lenders to pass these charges along to borrowers by increasing the mortgage rates they quote.

This doesn’t mean every new consumer loan will increase by a half point, though. First, the policy applies only for borrowers with credit scores lower than 680. Credit rating agencies do not disclose “average” credit score figures, but the Fair Isaac Corporation, whose software is used by many credit rating agencies, said the median score was about 723.

Related Blogs

• Related Blogs on “mortgage fees”