FHFA Announces Big Changes to Second Homes and High Balance Loans
That means that if you were considering purchasing a vacation home or use a high balance loan, it will be more expensive than before. High balance loans are mortgages originated in certain designated areas above the baseline conforming loan limit.
Beneficial pricing on some affordable loan programs, like HomeReady and Home Possible, will not be increased. Ask your Certainty Loan Officer for more information.
Here are the details:
- High-balance loan upfront fees will increase between .25% and .75% depending on the loan-to-value (LTV).
- Second home loan upfront fees will increase between 1.125% and 3.875% depending on the loan-to-value (LTV).
- These changes are effective for all new locks with Certainty Home Loans for Freddie Mac and Fannie Mae programs on or after Tuesday, January 11, 2022.
Freddie Mac and Fannie Mae
Freddie Mac and Fannie Mae are government-sponsored entities that play an important role in the nation’s housing finance system. They help provide liquidity, stability, and affordability to the mortgage market. Neither institution originates or services home loans. Instead, they purchase and guarantee mortgages issued through lenders like Certainty Home Loans. They also help stabilize mortgage markets and protect housing during extraordinary periods, such as the recent pandemic. Read more about Freddie Mac and Fannie Mae here.
Find a Local Loan Officer
If you have questions about how this change may affect your homeownership goals, contact one of our local Loan Officers. They will be able to go through your options and guide you through the process.