Fifty-one state bankers associations wrote to Federal Housing Finance Agency Director Mark Calabria today urging him to rescind the 50 basis point fee on refinance loans announced by Fannie Mae and Freddie Mac last week. This “adverse market refinance fee” would increase the cost for a typical borrower by an estimated $1,400 at a time when many are already experiencing financial hardships due to the coronavirus pandemic.
“While other federal entities are doing their utmost to keep rates low and the President has issued orders directing agencies to use all powers within their means to assist struggling homeowners in the current economic crisis, it is unfathomable that FHFA would allow Fannie Mae and Freddie Mac to undercut those efforts,” the state associations wrote. “We urge you to direct Fannie Mae and Freddie Mac to rescind this fee increase. It is ill-advised and clearly contrary to current efforts aimed at supporting a crisis-stricken economy while homeowners persevere through a public health crisis.”
ABA last week joined several other financial services, housing and consumer groups in a joint statement calling for the withdrawal of the fee, and lawmakers on both sides of the aisle have also expressed concerns about this action by the GSEs.