New Mortgage Fees Kick in, Saving Lower Credit Scores Thousands by Charging Higher Credit Scores More

Craig Bannister | May 1, 2023
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On Monday, a new Biden Administration rule took effect, raising mortgage fees on those with better credit and lowering them for those with lower credit scores, an analysis finds.

The new schedule Federal Housing Finance Agency (FHFA) schedule divides upfront fees on Fannie Mae and Freddie Mac mortgage loans into 80 categories, increases overall fees by 0.04% points and creates a redistribution of costs to those with good credit, an analysis by concludes.

Bankrate provides examples of how fees have changed for those with lower credit scores and higher scores, based on a hypothetical $350,000 loan:

  • 640-659 loan score making 20-25% down payment now pays $2,813 less.
  • 740-759 loan score making 20% down payment now pays $1,313 more.
  • 640-659 loan score making 25-30% down payment now pays $4,375 less.
  • 740-759 loan score making 25% down payment now pays $438 more.


While Biden’s new rule lowers the gap between the fees paid by good credit risks and those with lower scores, borrowers with higher credit scores still pay a lower total dollar amount in fees than those with lower scores.

In protest of the new rule, state treasurers and financial officers from 27 states sent a letter to President Joe Biden, declaring the new policy "unconscionable," “a disaster” and a “middle-class tax hike,” Fox Business reports. Biden is abusing the power of government to penalize hardworking Americans, the letter says:

"[T]he right way to solve that problem is not to use the power of the federal government to penalize hardworking, middle-class American families by confiscating their money and using it as a handout."

Manhattan broker Brian Lewis (a.k.a. “America’s Agent”) agreed with the letter’s assessment of the rule as a disaster, in an interview Monday on Fox Business Channel’s "Mornings with Maria":

"I think that putting people in a position to take a place that they really can't make happen is a recipe for disaster."


The business and economic reporting of is funded in part with a gift made in memory of Dr. Keith C. Wold.