Melvin L. Watt was sworn in Monday as the new director of the the Federal Housing Finance Agency (FHFA).
Watt came in guns blazing with a huge change. In December, the previous director, Edward J. DeMarco had announced a plan to reduce the slightly monopolistic hold Freddie Mac and Fannie Mae have on the housing industry. The strategy was to increase the base guarantee fee (g-fee) by .01 percentage points.
The goal behind this increase is to make it more expensive to use Freddie and Fannie, opening the door to other private firms.
Watt came into office saying that he would delay the planned increase until it went into a more indepth review. He said he wanted to ensure it would not have a negative impact on the housing market.
Some experts think that the increased fee would not open doors to other firms, but would only increase the cost of loans and ultimately get charged to the borrowers by the lenders.
Creekside Mortgage, Inc is here to help guide you through the home loan process. Call us today at 1.800.920.5420.