Fannie Mae and Freddie Mac to Increase Fees

Real Estate Agent with West USA Realty


Fannie Mae and Freddie Mac to Increase Fees

Fannie Mae and Freddie Mac to Increase Fees on home purchase loans.

Starting in April, 2012, Fannie Mae and Freddie Mac are expected to increase their fees, which will impact home buyers.

Why is this happening?  Fannie and Freddie were seized the the government in 2008 to help protect them from Money treefailing.  That's important because Fannie and Freddie, as well as other government agencies, actually guarantee about 90% of all new home loans.  With the difficulties that the recent housing market has seen, those guarantees have been important.  Fannie and Freddie have also cost the taxpayers more than $140 Billion.  So Fannie and Freddie will gradually increase their guarantee fees and reduce the size of the home loans they purchase in an effort to save taxpayers money and to reduce the amount of government involvement by attracting more private funding to the mortgage market.

Borrowers with a 30 year, fixed-rate mortgages near the current conforming loan limit of $417,000 can expect to pay more than $8500 over the life of the loan to fund the guarantee fee.  Future guaranty fee adjustments may also be necessary.  It will only affect new loan originations after April 1, 2012.  In another example, if a borrower obtains a loan for $220,000 and the increase is .1 percentage point (which is a number the white house proposed) then the increase will be about $15 per month on their payment. 

Posted by

Brenda Cunningham

Brenda Cunningham, Realtor
Ron & Brenda Cunningham

1640 S Stapley  #124
Mesa, AZ  85204

Brenda  602.980.3133
Ron  602-499-0694  
Fax: 602.863.4623

*Recognized in the Phoenix Business Journal as One of The Top 50 Realtors in the Valley





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