MBS market cheers delay of GSE refinance fee

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By Jennifer Kang
31 Aug 2020

The Federal Housing Finance Agency (FHFA) has delayed the implementation date of the adverse market refinance fee to December 1, following a wave of criticism from mortgage market participants. With more time to prepare before implementation, sources say the fee is a logical move on the part of the agencies to allow all players in the market to benefit from low mortgage rates, as well as shore up capital to cover losses stemming from the pandemic.

Under the adverse market refinance fee, Fannie Mae and Freddie Mac will charge lenders a 0.5% fee on all mortgage refinancings. The fee was scheduled to take effect on Tuesday September 1, but the implementation has been delayed after criticism from the industry.

Organisations such as the ...

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