How the new fee structure for mortgages impacts Arkansans

LITTLE ROCK, Ark. – When you think about purchasing a home, that comes with a mortgage, some people might assume that if you have a higher credit score, you get a lower rate.

Well, with a new rule that went into effect today, that changes.

Starting May 1, a new schedule of upfront fees applies to mortgages backed by Fannie Maw and Freddie Mac.

This change is a part of the Biden Administration rule to provide more accessible, equitable homeownership.

Backed loans (like FHA mortgages), jumbo loans, and other non-conforming loans are not impacted by the change.

So, for example, according to Bankrite.com, a borrower with a 650 credit score, with a 20% down payment on a $350,000 mortgage, before would have paid more than $10,000 in fees.

Under the new rule, the fees amount to around $7,800.

If someone has a higher credit score, around 740, before the new rule, you would have paid more than $1,700 in fees.

For you, that amount goes up to more ...