NPR, August 14, 2020: Want To Refinance Your Home Loan With Record Low Rates? Get Ready For A Hefty Fee
Millions of Americans are refinancing their mortgages to save money as superlow interest rates create a rare financial bright spot amid the pandemic.
But homeowners are about to get hit with a big new fee. Starting next month, all home mortgages that are refinanced will have to pay half of 1% of the loan. In other words, $1,500 for a $300,000 mortgage.
The fee will be charged by Fannie Mae and Freddie Mac, which guarantee about half of all mortgages in the country. The government-sponsored enterprises, Fannie and Freddie, were created separately decades ago to keep the market stable. Their loan guarantees make banks more willing to loan money.
Many experts say the new fee could discourage homeowners from refinancing.
