New Refinance Fees that Start on December 1

With the low interest rates many have either refinanced or are considering refinancing the remainder of their home loan. Refinancing when rates drop is a great way to save money. Due to COID-19, there has been a downturn in the economy, recently rates have been historically low. However, depending on your lender, you may have a new hike in fees added into your closing beginning December 1st as lenders try to recoup the loss in revenue. The fee is 0.5% on any Freddie Mac or Fannie Mae mortgage.

There are some borrowers that will be exempt from this fee, so it's important to know how to avoid this additional charge. To avoid the 0.5% fee the main question to ask any lender is if they are a direct lender or a portfolio lender. There are additional exemptions to the fee hike too, like being a first time buyer or refinancing a jumbo loan.

If you are considering refinancing, this article found in Forbes may help you better understand the new fee and help you in determining the best route to take going forward.