The reason for the new added fee, according to the Federal Housing Finance Agency, which oversees and regulates Fannie and Freddie, is to protect against anticipated losses from the coronavirus pandemic.
QUESTION: I read your recent article about refinancing. My daughter just got an interest rate a little under 3 percent, and I, too, would like to refi, but I just heard that the banks are going to start charging a surcharge on refis. Do you know anything about this?
ANSWER: I think what you are referring to are Fannie Mae and Freddie Mac, and the new fee they are going to start charging on most home loan refinances.
Fannie and Freddie are quasi-governmental agencies that buy the majority of home mortgages written by banks and then repackage them as mortgage-backed securities that are guaranteed against default.
Since Fannie and Freddie buy the majority of their home loans, banks are careful to adhere to the agencies’ underwriting guidelines, and the guarantee, in turn, allows banks to offer relatively low interest rates on such mortgages. But beginning Sept. 1 until otherwise directed, Fannie and Freddie will start charging an additional 0.5 percent fee on most home loan refis. The reason for the new added fee, according to the Federal Housing Finance Agency, which oversees and regulates Fannie and Freddie, is to protect against anticipated losses from the coronavirus pandemic.
What one arm of the federal government – the Federal Reserve Board -- giveth in the form of low interest rates, another arm of the government – the Federal Housing Finance Agency – taketh away.
QUESTION: I live in a condo association and our bylaws state that the voting in the annual meeting is based on unit percentage of ownership. The board refuses to abide by the bylaws regarding elections and only allows one vote per unit. What should the unit owners do?
ANSWER: Condo boards do not have the authority to disregard express provisions of the association’s governing documents and make up their own voting practices.
If the home owners’ efforts to educate the board members about proper procedures are unsuccessful, the unit owners are best served to organize and elect new board members.
Linda Goodspeed is a longtime real estate writer and author of “In and out of Darkness.” Email her at: firstname.lastname@example.org.