Published on January 28, 2021
Written by The Servion Group
The adverse market fee only applies to refinances of mortgages over $125,000.
The adverse market fee is mandated by the FHFA, which oversees Fannie Mae and Freddie Mac. The agency says the fee is intended to offset a projected $6 billion in losses related to loan forbearances and rising default rates due to high unemployment and economic uncertainty caused by the pandemic.
The fee has been criticized by the Mortgage Bankers Association and other industry groups, who believe it could become a costly hit to homeowners trying to make ends meet during these challenging economic times.
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