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The Adverse Market Fee Is Gone! Here’s What That Means For Your Refinance.

Your mortgage refinance is about to get cheaper!



Today, to help families reduce their housing costs, the Federal Housing Finance Agency (FHFA) announced that Fannie Mae and Freddie Mac will eliminate the Adverse Market Refinance Fee for loan deliveries effective August 1, 2021.


This fee was implemented last year by the government-sponsored enterprises and was designed to cover losses projected because of the COVID-19 pandemic. As a result, the cost to refinance increased for borrowers as lenders had to make up for these fees in the form of higher interest rates or increased closing costs.


Luckily, the success of FHFA and the Enterprises’ COVID-19 policies reduced the impact of the pandemic and were effective enough to warrant an early conclusion of the Adverse Market Refinance Fee. According to FHFA Director Sandra L. Thompson,

The COVID-19 pandemic financially exacerbated America’s affordable housing crisis. Eliminating the Adverse Market Refinance Fee will help families take advantage of the low-rate environment to save more money. Today’s action furthers FHFA’s priority of supporting affordable housing while simultaneously protecting the safety and soundness of the Enterprises.

Starting next month, mortgage lenders will no longer be required to pay these enterprises a 50-basis point fee when they deliver refinanced mortgages. FHFA’s expectation is that those lenders who were charging borrowers the fee will pass cost savings back to borrowers.


What does this mean for you?


The removal of the adverse market fee means you will soon be able to refinance your mortgage at a lower cost. If you have been waiting to refinance because of fees or high interest rates, now may be a great time to revisit your options for lowering your payment, shortening your loan term, or taking cash out.


Contact us to request a consultation and begin your refinance process today.