Big Fee Increases Coming From Fannie Mae & Feddie Mac

We just read a news article that both Fannie Mae and Freddie Mac are planning on toughening up their credit score and downpayment rules.  As of April 1, they will implement new guidelines for loans backed by them.  The new guidelines will require buyers that are putting down less then 25% for a downpayment to be charged a penalty of 3/4 of a point (a point equals 1% of the loan amount).  It won't matter what the buyer's credit score is, if they are putting less then 25% down for a mortgage loan, they will be penalized 3/4 (0.75%) of a point.

Buyers of duplexes, where one unit is owner-occupied and the other is rented, will be charged a 1 percent add-on as a penalty, while those who are refinancing their homes and who plan to take cash out will be charged as much as three points if they have a low to moderate equity stake in their homes.

Many major lenders are already factoring in these higher fees, which reduces the effectiveness of the stimulus efforts.  Brad German, Freddie Mac's spokesman,  said that the loan categories & credit risk combinations targeted by these fees "default at four to eight times" the rate of other mortgages that were backed by Freddie Mac. The reason for these fees, according to German, "We have to manage these risks appropriately,".

So, if you are seriously planning to buy a home, this may be an ideal time to make that offer on that special home, get under contract, and settled before your mortgage loan includes these new fees and charges.  If you haven't found that new home, yet...don't delay!  Call us NOW at 609-417-1084 so we can help you find that special new home in record time and get you moved in.

Linda & Terry Iwaniw
REALTOR Associates
First Time Home Buyer Specialist
Marketers of HUD Owned Homes
ReSales & Investment Realty, LLC
856-795-3111 x263
609-417-1084
http://www.snewjerseyhomes.com/