Eye was startled when we read the article noted below from The Washington Times today. Here’s a synopsis of it but you can read the entire article for yourself and we suggest you do that. It is filled with information you need if you are going to purchase a home.
Eye would also like to note – We reached out to numerous local lenders about this big change for home buyers and none of them would go on record due to a fear of being “canceled” by the woke mob. Off the record, they were not happy with these new rulings and you will not be either.
Basically the article states that starting May 1, 2023, a new federal rule will force homebuyers with good credit scores to pay higher mortgage rates and fees to subsidize people with riskier credit ratings who are also in the market to buy houses.
The rule is part of the Federal Housing Finance Agency’s push for affordable housing, and it will affect mortgages originating at private banks across the country.
The federally backed home mortgage companies Fannie Mae and Freddie Mac will enact the loan-level price adjustments.
Mortgage industry specialists say that homebuyers with credit scores of 680 or higher will pay around $40 more per month on a home loan of $400,000, and homebuyers who make down payments of 15% to 20% will be charged the highest fees.
The changes will only apply to Americans buying houses or refinancing after May 1. The new mortgage financing rules will allow homebuyers with riskier credit ratings and lower down payments to qualify for better mortgage rates and discounted fees.
The fee changes are intended to subsidize higher-risk borrowers by imposing “an intentional disruption to traditional risk-based pricing.”
However, the rule has been met with criticism from lenders and real estate agents who say that it punishes homebuyers with high credit scores and homeowners seeking to refinance for their relatively strong financial positions.
The agency has delayed to Aug. 1 an upfront fee for debt-to-income ratios of 40% or more after facing criticism. Lenders and real estate agents are worried about the impact of the debt-to-income fee that takes effect in August because homebuyers might feel as if they are in a game of “bait and switch” on their projected borrowing costs.
Read all the details here:
Biden to hike payments for good-credit homebuyers to subsidize high-risk mortgages
Eye is not in favor of this new ruling simply because once again we will probably find ourselves in a housing crisis and the economy is already in trouble as it is.
That’s our opinion. What say you?