They Did WHAT With Mortgages?

If you follow the news at all, or even just scroll social media on occasion, you've likely heard about the changes happening in the mortgage world. These headlines you have seen are not "new" news, and as a matter of fact we've known about this for many months. 

Not in the know? Here are a few samples of what the headlines have looked like recently:

Why having good credit could cost you more on a home mortgage

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'It's going to hit the consumer hard': Those with higher credit scores may pay higher mortgage fees

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How the US is subsidizing high-risk homebuyers — at the cost of those with good credit

So what happened?

I don't want to get political, but this news was picked up and spun faster than a Whirlpool spin cycle by many news outlets...and about 4 months late. This lead to a lot of confusion--not to mention misinformation--about what is actually going on. 

To help clarify things, I went straight to the source. I asked a couple lenders I know to give their take on what is happening. 

​Take #1-

"First, it is still better to have higher credit than lower. There is an absolute ton of misinformation swimming about. If you’ve got perfect credit, you’ll see a slight decrease in fee. If credit is really good but not super hot shot, your fee will go up slightly. If you have credit below 680, you’ll see your fees go down. This does make housing more affordable for scores below 680 but does charge borrowers with scores between 700-779 slightly more. The attached is a very simple example at the various credit scores using a purchase of $500k with 20% down." 

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-Kelly Naff, Victory Home Loans

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Take #2-

"The new Fannie Mae and Freddie Mac go into effect May 1st and what this means for buyers in the market is that getting preapproved with a lender that can help you understand how to leverage your funds in the right way is still your best bet. You’re still in a better position with higher credit and higher down payment so the sooner you start your mortgage journey, the better you can prepare yourself."

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-Jessica Scolastico, CMG Home Loans

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I hope this helps you find some clarity. Remember that the headlines you see are designed to generate a reaction so you click for more, and often don't help bring any rational analysis. At the end of the day, the best source for how these changes will impact your individual situation as a home buyer is a mortgage lender. 

Jennifer Schurter is a real estate agent and expert marketer serving the Greater Portland, Oregon Metro Area and the Willamette Valley of Oregon. If you're looking to start the journey toward buying a home, selling a home, or investing in real estate assets, you may reach Jennifer at jen@jenschurter.com.