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New Fees On Conforming Loans
“I KEEP
HEARING ABOUT NEW LENDING STANDARDS THAT ARE NOW IN PLACE DUE TO THE
SUBPRIME CRISIS. WILL THESE NEW STANDARDS AFFECT ME EVEN IF I HAVE GOOD
CREDIT?”
Although it depends on
several different factors (your credit score, the type of loan you’re
applying for, etc.) the short answer to that question is yes, the new
standards will affect all borrowers one way or another. Beginning March
1st, Fannie Mae and Freddie Mac added new credit score-based fees to all
conforming loans. If you’re financing more than 70 percent of a home’s
purchase price, the following risk-based fees will now apply:
• Credit scores of
660-679: Additional 0.75 percent fee.
• Credit scores of
640-659: Additional 1.25 percent fee.
• Credit scores of
620-639: Additional 1.75 percent fee.
• Credit scores of 620
or lower: Additional 2.00 percent fee.
Even if your credit
score is above 680, though, you’ll still have to pay another fee from
Fannie Mae and Freddie Mac. This new fee is a 0.25 percent “delivery
fee” on all loans that the two mortgage giants back. With this fee alone
you’ll be paying an additional $250 for every $100,000 borrowed. Of
course, everyone’s credit situation and borrowing profile is different
so check with your mortgage professional for more details. ∆ |
