WASHINGTON—Many homeowners who refinance their mortgages in the next three months will avoid paying an additional fee averaging $1,400, a federal regulator said Tuesday. Mortgage-finance giants Fannie Mae and Freddie Mac will delay a 0.5% surcharge on refinanced home loans until Dec. 1, said the Federal Housing Finance Agency, which regulates them. The decision came after an outcry from industry groups, lawmakers and the White House, saying the fee was inappropriate in the middle of the coronavirus pandemic and would hurt consumers. “It doubled the costs of refinancing for most of my clients,” said Steve Walsh, president of Scout Mortgage in Scottsdale, Ariz. “They don’t need added costs right now.”Record-low interest rates are spurring a refinancing boom that is helping Americans cope with the recession by lowering their monthly mortgage payments. The fee will add an estimated $1,400 to the average mortgage guaranteed by Fannie and Freddie, though that amount could be spread over the life of the loan, so borrowers would only see a modest increase in monthly costs.

Source: Wall Street Journal August 25, 2020 20:02 UTC