NW Riverside News

On May 2, Congressman Ken Calvert (CA-41) introduced the Secure Americans from Financial Exploitation (SAFE) Act, H.R. 3041, to protect responsible homebuyers from higher, unfair fees on their mortgages. On May 2, the Federal Housing Finance Agency (FHFA) implemented new loan-level price adjustments (LLPA) on conventional mortgages where borrowers with higher credit scores will generally be forced to pay higher upfront fees, while borrowers with low credit scores will see their fees lowered.  

“It’s blatantly unfair to impose increased fees on homebuyers simply because they have a higher credit score,” said Rep. Calvert. “With interest rates on the rise, these new higher fees will only make homebuying more expensive for American families. Raising rates on homebuyers with good credit scores is unnecessarily punitive and stands contrary to the risk-based approach commonly associated with our housing finance programs. Congress should pass the SAFE Act now to stop these new high credit score fees on homebuyers and focus on strengthening traditional federal programs designed to help first-time, Veteran, and other homebuyers.”

The SAFE Act would block the implementation of the changes to the single-family housing mortgage credit fee pricing framework of the enterprises announced by the FHFA on January 19, 2023.

Under the changes, a borrower with a 700 credit score and a 20% down payment previously would have paid an upfront fee equal to 1.25% of the loan amount — $7,500 on a $600,000 loan. Under the new FHFA LLPA’s, the borrower’s fees are raised to 1.375%, or a total of $8,250 on a $600,000 loan.

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