Mortgage rates remain impressively low, despite new fee
Mortgage rates remain impressively low, despite new fee
Mortgage rates remain impressively low, despite new fee

Average mortgage rates are a little higher this week but haven't ventured too far from their recent all-time lows, according to a popular survey,

Rates rose after a new fee on refinance loans seemed to come out of nowhere earlier in the month.

The fee "caught lenders off guard, placing many in a difficult financial spot and forcing them to raise rates across the board — even for purchase loans, which aren’t directly affected by the new policy — in order to cover their losses," explains Matthew Speakman, an economist with Zillow.

According to a report this weekend, the new surcharge may be delayed. In the meantime, smart comparison shoppers can still find 30-year mortgage rates below 3%, and even under 2%.

Mortgage rates are higher — but hardly 'high'

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Mortgage rates have risen just slightly this week.

Mortgage rates went up last week for a second straight week and were averaging 2.99% for a 30-year fixed-rate loan, mortgage company Freddie Mac reported on Thursday.

Rates climbed from the previous week's average of 2.96%, but they weren't much higher than two weeks earlier, when they averaged just 2.88%. That was a record low for the Freddie Mac survey, which has been monitoring mortgage rates since 1971.

And, mortgages are still pretty cheap compared to last year at this time, when 30-year loans were more than a half-point higher at an average 3.55%. The rates in the survey come with an average 0.8 point.

The new fee that's helped push rates higher was scheduled to take effect Sept. 1. Lenders heard about it from Freddie Mac and Fannie Mae, two government-sponsored mortgage giants that buy or back most home loans issued in the U.S.

The companies said they needed to start charging a 0.5% "adverse market refinance fee" because of higher risks and costs stemming from the COVID-19 crisis. The Mortgage Bankers Association warned that the surcharge would increase costs for the average borrower by about $1,400.

Now, the Federal Housing Administration, which regulates Fannie and Freddie, is talking about delaying the fee, though not dropping the matter altogether, The Wall Street Journal reported on Saturday.

Rates still look appealing to homeowners, homebuyers

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Homebuyers and homeowners are still finding great rates.

All-time-low mortgage rates have made 2020 a massive year for refinancing, as homeowners have found they can chop down their monthly payments and their total interest costs.

Even with the slight bump-up in rates, research from mortgage data firm Black Knight indicates 15.6 million homeowners still have an opportunity to lower their mortgage rate by at least three-quarters of 1 percentage point (say, from 3.75% to 3%) and shrink their housing costs by an average $289 a month.