With mortgage rates still at historic lows, it may seem like a good time to refinance. Starting September 1, however, the cost of refinancing a mortgage is going up due to economic risks associated with Covid-19.
Both Freddie Mac and Fannie Mae have announced a new mortgage refinancing fee of 0.5%. The fee comes as mortgage refinancing accelerates due to lower interest rates. Fannie Mae calls it an Adverse Market Refinance Fee. In Lender Letter (LL-2020-12) Fannie Mae said the fee was in “light of market and economic uncertainty resulting in higher risk and costs incurred by Fannie Mae.”