Mortgage fees are changing May 1st - Here's what you need to know

Will homebuyers with good credit face higher mortgage fees than homebuyers with risky credit? The answer is - it’s complicated. 

There’s a new mortgage fee policy going into effect on May 1st that has taken over the news circuit recently. This sudden influx of articles has many potential homebuyers confused and frustrated. 

Here’s what you need to know: 

1. This policy only applies to loans that are guaranteed by Fannie Mae and Freddie Mac.
   
   
2. This policy aims to provide relief to minority and low-income borrowers amid the housing affordability crisis.
   
   
3. This policy change does not affect anyone with an existing mortgage.
   
   
4. These are not “new” fees. The fees have always existed; however, the new policy uses an updated matrix to determine the pricing of the fees. Essentially, lessening the fee gap between homebuyers with good credit and risky credit.
   
   
5. This news was actually announced back in January and many lenders have already implemented the policy changes months ago!
   
   
6. Many mortgage lenders will still tell you, “Better credit scores = better rate.” 

For a more detailed breakdown of this mortgage policy, check out this helpful article from Mortgage News Daily, Is There Really a New, Unfair Mortgage Tax on Those With High Credit?

If you want to learn more about the new mortgage policy, please let me know and I will connect you with a qualified lender that can answer all of your questions.