According to a report by The Washington Times, homebuyers with good credit will soon be required to pay higher mortgage rates and fees to subsidize people with riskier credit ratings as part of the Federal Housing Finance Agency’s efforts to promote affordable housing.
Under a new federal rule enforced by the Biden administration, individuals seeking to purchase a home with a credit score of 680 or higher will have to pay around $40 more per month than those with lower credit scores when taking out a home loan of $400,000, the report stated.
The new rule will come into effect on May 1 and will impact mortgages from private banks nationwide. The loan-level price adjustments (LLPAs) will be established by Fannie Mae and Freddie Mac, which are federally-backed home mortgage companies, according to The Washington Times.
