The Federal Housing Finance Agency (FHFA) announced Friday that it would be eliminating the adverse market refinance fee from Fannie Mae and Freddie Mac home loans, making refinancing a mortgage cheaper for homeowners.
The elimination will apply to all mortgage loans beginning Aug. 1, 2021. The 50-basis point fee was instated last year by the Trump administration amid the COVID-19 pandemic, as Fannie Mae and Freddie Mac saw their profits decreasing due to the mortgage giants’ programs to help struggling families during the pandemic.
“The COVID-19 pandemic financially exacerbated America’s affordable housing crisis,” FHFA Acting Director Sandra L. Thompson said in a statement. “Eliminating the Adverse Market Refinance Fee will help families take advantage of the low-rate environment to save more money.”