By Bonnie Sinnock
Two Republican members of Congress have introduced bills aimed at canceling the
Federal Housing Finance Agency's latest adjustments to government-sponsored
enterprise mortgage fees.
Rep. Andy Biggs, R.-Ariz. introduced H.R. 2928 and Rep. Stephanie Bice, R.-Okla,
sponsored H.R. 2876, both of which seek to roll back the overhaul of the GSEs' loan-
level price adjustments.
More than 30 Republican co-sponsors backed Biggs' bill. Bice's bill has 14. The text of
Bice's bill was not available at deadline but the information available for both indicate
that they would simply cancel the most recent fee changes.
Biggs and other Republican lawmakers have shown concern that the cross-
subsidization involved in the new pricing leads to borrowers with lower credit scores
getting breaks at the expense of those with better payment track records.
"The FHFA — led by a President Biden-appointed director — is punishing financially
responsible mortgage borrowers," Biggs said in a press release, adding that, "If
implemented, the latest FHFA fee change could result in thousands of dollars in
additional fees for lower-risk homeowners over time, while encouraging and rewarding
financial irresponsibility."
FHFA Director Sandra Thompson recently pushed back on such criticisms, saying in a
statement that the practice has long been in Fannie Mae and Freddie Mac's statutory
charters and that the recent changes are misunderstood.
She said the FHFA is cross-subsidizing lower-income borrowers, not those with lower
credit scores, and that while these are primarily offset with higher fees on other products
like cash-out, high balance and second-home loans, not all borrowers with higher credit
scores are penalized and some may even see their fees decrease or remain flat
because the price changes are nuanced.
Currently, underwriting generally requires a borrower who gets a break due to their
income to have other strong indicators of an ability to repay.
Thompson has questioned why the most recent revision to pricing has been met with
opposition.
Lenders have characterized the most recent update of the pricing grids as more far
reaching and complex than past revisions.
Thompson has said the grids required extensive update because they were sorely in
need of modernization.
Bonnie Sinnock
Capital Markets Editor, National Mortgage News
