We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
Fannie Mae (QB) | USOTC:FNMA | OTCMarkets | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 3.01 | 2.99 | 3.01 | 0.00 | 11:46:22 |
By Andrew Ackerman
Fannie Mae and Freddie Mac said they would impose a new fee to insulate themselves from losses on refinanced mortgages they guarantee, a sign of potential turbulence in the housing market and a move likely to generate pushback from lenders.
The government-controlled companies, which back nearly half of the $11 trillion U.S. mortgage market, said late Wednesday that they would begin charging lenders the added fee next month. It will apply to most loans they buy that borrowers have refinanced to lock in a lower interest rate.
Some mortgage lenders have reported record earnings amid a refinancing boom, and the fee could damp their future profits. It is equal to 50 basis points, or half a percentage point, on each loan Fannie and Freddie guarantees, or roughly $1,400 on the average mortgage backed by the companies, according to industry estimates.
Industry officials said the fee isn't correlated with the risk of refinanced loans and would simply be passed on to consumers, increasing their costs at a time when the Federal Reserve was acting aggressively to support lower interest rates. Borrowers would likely see only a modest increase in their monthly costs, since the fee would be paid over the life of their loan.
Bob Broeksmit, chief executive of the Mortgage Bankers Association, said the move was inappropriate at a time when Fannie and Freddie are reporting large profits -- a combined $4.33 billion in the second quarter.
"For the GSEs to add a 50 basis-point surcharge on refinances when the nation is struggling with the greatest economic downturn since the Great Depression is outrageous," he said in an interview, referring to Fannie and Freddie's status as government-sponsored enterprises, or GSEs.
A representative for the Federal Housing Finance Agency, which oversees Fannie and Freddie, said the companies requested the "adverse market fee." It will apply to most refinanced mortgages delivered to the firms beginning Sept. 1.
Fannie and Freddie buy mortgages from lenders, package them into securities that are sold to investors and provide guarantees to make the investors whole if the loan defaults. They don't lend to homeowners.
The fees could help bolster the finances of Fannie and Freddie as they prepare to raise capital and potentially exit from their 11-year tenure under government control.
Write to Andrew Ackerman at andrew.ackerman@wsj.com
(END) Dow Jones Newswires
August 12, 2020 22:27 ET (02:27 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
1 Year Fannie Mae (QB) Chart |
1 Month Fannie Mae (QB) Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions