Combination of Housing shortage, COVID-19 Pandemic and Historically Low interest rates Created the ideal conditions for homeowners to do Refinance their mortgage In many parts of the United States. And after August 1st, refi trading could be even sweeter.
Mortgage giants Fannie Mae and Freddie Mac said they would lower refinancing fees in markets that are unfavorable to everyone Refinancing Mortgage From next month. Refinancing fees translate into 0.5% of your refinancing loan, or about $ 500 for every $ 100,000 you borrow.
Government fees added December 2020 To allow Fannie Mae and Freddie May to recoup some of the losses they expected to incur government-backed lenders during the COVID-19 pandemic. In most cases, the lender will pass this fee to the borrower and may add thousands of dollars to refinancing. This move was seen as a way to offset subsequent lender losses. Coronavirus support law Placement Federal ban Foreclosure and Offering Options to Homeowners pause Payment of their mortgage.
It’s not clear if the US economy is still on a solid foothold- Inflation surge Some economists are worried. Eliminating this fee is good news for homeowners considering refinancing.
From April to July 2020, when the pandemic surged, about 5% of Fannie Mae and Freddie May borrowers Mortgage tolerance program. According to FHFA data, it has dropped to 2% since then. The agency said the success of the COVID-19 policy ensured that the pandemic impact on Fannie Mae and Freddie May’s loans would be mitigated and that fees would be terminated early so that lenders could pass on their savings to borrowers. ..
“The COVID-19 pandemic has exacerbated America’s affordable housing crisis financially. Eliminating unfavorable market refinancing fees helps families take advantage of the low interest rate environment to save more money. That would be, “said Sandra L. Thompson, director of the Federal Housing Finance Agency. Press release.. The FHFA was created following the 2008 housing crisis, and government agencies Guardian Fannie Mae and Freddie May Mortgages.
Some refinancing loans are already exempt from fees, such as homes under $ 125,000, homes refinanced through Fannie Mae’s Home Lady or Freddie Mac’s Home Possible Program, and government-sponsored mortgages. FHA, VA And USDA loan. In some areas, jumbo mortgages of $ 510,400 to $ 765,000 have also been exempted.
Refinancing rate Except for 10-year fixed loans, it will continue to fall in July. The FHFA said it will continue to monitor the housing finance system and make adjustments as necessary.
If you’re considering a mortgage refinance, rates may be going even lower Source link If you’re considering a mortgage refinance, rates may be going even lower