Fannie Mae and Freddie Mac (the “GSEs”) recently announced an update regarding the new Adverse Market Refinance Fee. The new updates include a clarification that the refinance exception will be applied to loans with an original principal amount less than or equal to $125,000. The GSEs previously announced that refinance loans with loan balances less than $125,000 will be exempt from the new fee.
Additionally, Freddie Mac has updated Guide Exhibit 19 of the Single-Family Seller/Servicer Guide to reflect this refinance exception, along with a fee exclusion for Construction Conversion Mortgages that are documented using either integrated documentation (single-close) or modified documentation without a new note.
DocMagic’s previous article regarding the Adverse Market Refinance Fee, effective for refinance mortgages with settlement dates on or after December 1, 2020, can be found here.
If you have any questions regarding this article, please contact DocMagic’s Compliance Department.
