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Sept. 4, 2012 – The Federal Housing Finance Agency announced Friday it has directed Fannie Mae and Freddie Mac to raise the guarantee fees they charge on single-family mortgages by an average of 10 basis points.
 
The fee increase will begin Nov. 1 for loans sold for cash and Dec. 1 for loans exchanged for mortgage-backed securities, FHFA said. Fannie and Freddie will work directly with lenders to implement the changes.
 
FHFA said the fee increases are aimed at fostering greater participation from the private sector in the housing market, a key goal outlined in FHFA’s strategic plan for reforming the government-sponsored enterprises. The new guarantee fees will help streamline what the GSEs charge lenders who deliver different size loan volumes and also reduce cross-subsidies between higher-risk and lower-risk mortgages, the agency said.
 
In making the announcement, FHFA Acting Director Edward DeMarco said the changes “will move Fannie Mae and Freddie Mac pricing closer to the level one might expect to see if mortgage credit risk was borne solely by private capital.”
 
On Friday, FHFA also released its fourth annual report on single-family guarantee fees, covering the years 2010 and 2011. The report, required by the Housing and Economic Recovery Act of 2008, found that the average guarantee fee charged by Fannie and Freddie increased from 26 basis points in 2010 to 28 basis points in 2011.
 
FHFA also said it will soon be seeking public input on a yet-to-be unveiled proposal to developing risk-based pricing at the state level.
 
NAFCU has repeatedly expressed concerns that increasing the enterprises’ guarantee fees could result in some small lenders leaving the home loan market, making it more difficult for consumers to find mortgage credit.