Borrowers With Good Credit Scores to Foot the Bill for Higher Risk Borrowers
It is disheartening to think that those of us who have worked hard to maintain good credit scores will now be penalized with higher mortgage rates and fees, just so the government can subsidize people with riskier credit ratings. It’s no surprise that the Federal Housing Finance Agency’s (FHFA) new rule forcing homebuyers with good credit scores to pay higher mortgage rates and fees is causing a stir. The Federal Housing Finance Agency’s push for affordable housing is admirable, but it should not come at the expense of those with good credit scores who are trying to buy or refinance their homes.
This fee increase affects all mortgages originating at private banks across the country. The loan-level price adjustments that will be implemented by Fannie Mae & Freddie Mac on May 1st will disproportionately affect those with credit scores above 680 and down payments between 15-20%. This means that individuals who have worked hard to maintain their financial responsibility through responsible borrowing habits are now being punished for doing so.
In response to FHFA’s new rule, Brian Stevens of NREP daily has started a petition calling out FHFA on their unfair loan level price adjustment on mortgagees with good credit scores – something we can all agree needs attention from our lawmakers as soon as possible! It’s simply not right that responsible borrowers should have to bear an extra financial burden just because some don’t follow through on their obligations.
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