It is estimated that refinanced mortgage loans in 2020 will reach a total value of $2 trillion by the end of the year. Only 2003 has surpassed that amount since mortgage loan data started being tracked fifty years ago. However, the cost of refinancing is about to get a little more expensive.
An “adverse market fee” goes into effect on December 1. The fee, which is meant to protect the nation’s largest loan backers, Fannie Mae and Freddie Mac, from losses related to COVID-19, will typically be passed along by mortgage lenders to borrowers.
But every borrower is different, and many loans are different too. It is possible to avoid the fee entirely or have the loan structure to minimize its impact. That is why it might be more important than ever for borrowers to shop around.