The TILA-RESPA Integrated Disclosure rules require mortgage lenders to disclose prices within three days of an application. But to do so they have to rely on frequently faulty income and debt information.
By targeting price cuts at low-FICO score and high-LTV borrowers, the new pricing grids of Fannie Mae and Freddie Mac could increase market overlap with FHA.
Upfront fees will decline for most low-income borrowers, but will increase for some middle-income homebuyers. The result is more cross-subsidy for the GSEs’ mission-based activities.
Fannie and Freddie will institute their own models for assessing the values of MSRs held by seller/servicers, even if those MSRs are for mortgages not owned or guaranteed by the GSEs.
In a reissued bulletin, the mortgage giant said it will allow some duty-to-serve cash-out refinances to receive 0% credit fee caps because of the confusion caused by an earlier notice.
Going forward, the FHFA will seek public comments when the GSEs are looking to launch new activities or products. There are also some broad exceptions to the public notice standard.
The Community Home Lenders of America wants federal officials to ban significant disparities in the fees charged to lenders for credit reports, but analysts say it’s unlikely that policy pressure will stop them.
Homeownership programs could take a lesson from scholarship models in the education field: Intentional first-generation assistance programs could add five million net new homeowners.