The Credit Union National Association recently expressed support for the Federal Housing Finance Agency’s decision to delay proposed guarantee fee increases.
Under its former acting director Ed DeMarco, the FHFA planned to raise base guarantee fees for all mortgages by 10 basis points, eliminate the up-front 25 basis-point adverse market fee and update the up-front guarantee fee grid to align pricing with the borrower’s credit risk.
Current FHFA Director Mel Watt, who was recently sworn into the office, said earlier this week that he will evaluate the changes and would give at least 120 days notice before implementing any new changes.
“The implications for mortgage credit availability and how these changes might interact with the new qualified mortgage standards could be significant,” Watt said, according to the National Association of Federal Credit Unions, which has also opposed the fee hike. “I want to fully understand these implications before deciding whether to move forward with any adjustments to g-fee pricing.”
CUNA President and CEO Bill Cheney said the FHFA has allowed fees to gradually increase, thereby “making home lending unnecessarily expensive for lenders and [borrowers].
“For the benefit of many American homebuyers, we hope that moving forward the FHFA will help curtail these fee increases,” Cheney said.
The National Association of Federal Credit Unions said the proposal would increase the cost of borrowing and slow lending during a still-fragile economic recovery.