Mortgage refinancing is getting more expensive as Fannie Mae, Freddie Mac add ‘COVID fee’
Mortgage rates are historically low, but now, there’s a catch if you want to refinance.
Mortgage giants Fannie Mae and Freddie Mac are adding their own version of a COVID fee.
It means if you’re refinancing right now, get those documents together and wrap it up quickly. If it’s something on your to-do list, then this new fee will likely affect you.
The two leaders are calling it a “market condition credit fee” and the fee equals 0.5%
of the loan amount.
In Florida, the average mortgage debt is around $187,000, according to Experian, so the fee could cost the average homeowner an extra $930 at closing if you settle on or after their Sept. 1 deadline.
Freddie Mac says the fee is because of risk management and loss forecasting.
Again, this fee goes into effect Sept. 1 for refinancing only, and it will not affect new home purchases.