New FHA administrative fee defeated in Congress
CMLA lead opposition to costly 4bp fee on mortgage lenders
A provision in Senate Bill 2438 that would have allowed the Federal Housing Administration to charge a 4 bp administrative fee has been formally dropped from the Transportation, Housing and Urban Development and Related Agencies Appropriations Act.
The provision contained in the Senate bill would have assessed the fee on lenders, costing $40 for every $100,000 borrowed.
The U.S. Department of Housing and Urban Development had been negotiating to get the proposed hike into the House version of the spending bill, but after the alarm was raised by the Community Mortgage Lenders Association and others it was dropped, HousingWire has confirmed.
“[CMLA] is pleased to have succeeded in blocking additional costs for borrowers seeking FHA-insured mortgages next year and the lenders who will originate those loans. Mid-sized and small community-based lenders help many consumers, particularly first-time buyers, to realize their homeownership aspirations with FHA-insured mortgages,” said CMLA Chair Paulina McGrath said. “The last thing that those consumers, and the lenders who serve them, needed were additional fees that increased the cost of their home loans. We are proud to have taken a principled stand opposing these fees, for the benefit of consumers and the mid-sized and small lenders who serve their financing needs.”