In the ongoing effort of ensuring that home ownership in the United States maintains its affordability, a group of lawmakers is taking steps to potentially reduce fees charged by Fannie Mae and Freddie Mac on conventional/conforming mortgages.
This follows recent changes in the structure of the fees they charge, which has decreased home affordability in the wake of the COVID-19 pandemic. The Home Mortgage Disclosure Act (HMDA) was amended by the Economic Growth, Regulatory Relief and Consumer Protection Act of 2018 (EGRRCPA) in a bid to reduce the impact of the fees.
In short, the primary aim of the bill was to reduce risk-based expenses for the two key mortgage lenders, Fannie Mae and Freddie Mac. The proposed adjustment to the levels of their affiliated Loan Level Price Adjustment (LLPA) fees would both reduce these costs and improve the market’s ability to compete in the current environment.
With the proposed legislative effort focused on reducing the LLPA fees, the initiative seeks to make mortgages more affordable while maintaining stability in the nation’s housing market.
Key points:
• Lawmakers are taking aim at reducing fees charged by Fannie Mae and Freddie Mac on conventional mortgages
• HMDA amended by EGRRCPA of 2018 with the aim to reduce impact of the fees
• Primary aim of the bill is to reduce risk-based expenses for the two key mortgage lenders
• Proposed adjustment to LLPAs to reduce costs and improve the market’s competitive environment
• Initiative seeks to make mortgages more affordable while maintaining stability in the housing market
You can read this full article at: https://www.housingwire.com/articles/lawmakers-introduce-bill-to-block-llpa-fee-changes/(subscription required)
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