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NAR joined a coalition of housing, finance, and consumer groups that sent a letter to the FHFA and administration requesting it remove a newly announced fee on refinance mortgages backed by Fannie Mae and Freddie Mac.
The FHFA announced on August 13th, the imposition of a new 50 basis point fee on all loans refinanced by Fannie Mae or Freddie Mac. The fee translates into an increase of roughly 0.10% in rate and would likely be absorbed by lenders initially before being passed onto consumers.
The fee only applies to refinances and not purchase mortgages. However, the GSEs use revenue from refinances to support home purchases in underserved areas like low and moderate income communities, small and mid-sized towns, and areas hit by economic or natural disasters. Refinancing is also a way for persons in stress to make ends meet and prevents a flood of distressed homes on the market.